87062 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

DEPARTMENT OF ENERGY 

10 CFR Parts 429 and 431 

[EERE–2020–BT–STD–0007] 

RIN 1904–AF55 

Energy Conservation Program: Energy 

Conservation Standards for Expanded 

Scope Electric Motors 

AGENCY: Office of Energy Efficiency and 

Renewable Energy, Department of 

Energy. 

ACTION: Notice of proposed rulemaking 

and announcement of public meeting. 

SUMMARY: The Energy Policy and 

Conservation Act, as amended 

(‘‘EPCA’’), prescribes energy 

conservation standards for various 

consumer products and certain 

commercial and industrial equipment, 

including electric motors. In this notice 

of proposed rulemaking (‘‘NOPR’’), DOE 

proposes new energy conservation 

standards for a subset of electric motors, 

expanded scope electric motors, 

expressed in terms of average full-load 

efficiency, and also announces a public 

meeting to receive comment on these 

proposed standards and associated 

analyses and results. 

DATES: 

Comments: DOE will accept 

comments, data, and information 

regarding this NOPR no later than 

February 13, 2024. 

Meeting: DOE will hold a public 

meeting on Wednesday, January 17, 

2024, from 10 a.m. to 4 p.m., in 

Washington, DC. This meeting will also 

be broadcast as a webinar. 

Comments regarding the likely 

competitive impact of the proposed 

standard should be sent to the 

Department of Justice contact listed in 

the ADDRESSES section on or before 

January 16, 2024. 

ADDRESSES: The public meeting will be 

held at the U.S. Department of Energy, 

Forrestal Building, Room 1E–245, 1000 

Independence Avenue SW, Washington, 

DC 20585. See section VII of this 

document, ‘‘Public Participation,’’ for 

further details, including procedures for 

attending the in-person meeting, 

webinar registration information, 

participant instructions, and 

information about the capabilities 

available to webinar participants. 

Interested persons are encouraged to 

submit comments using the Federal 

eRulemaking Portal at 

www.regulations.gov under docket 

number EERE–2020–BT–STD–0007. 

Follow the instructions for submitting 

comments. Alternatively, interested 

persons may submit comments, 

identified by docket number EERE– 

2020–BT–STD–0007, by any of the 

following methods: 

Email: ElecMotors2020STD0007@

ee.doe.gov. Include the docket number 

EERE–2020–BT–STD–0007 in the 

subject line of the message. 

Postal Mail: Appliance and 

Equipment Standards Program, U.S. 

Department of Energy, Building 

Technologies Office, Mailstop EE–5B, 

1000 Independence Avenue SW, 

Washington, DC 20585–0121. 

Telephone: (202) 287–1445. If possible, 

please submit all items on a compact 

disc (‘‘CD’’), in which case it is not 

necessary to include printed copies. 

Hand Delivery/Courier: Appliance 

and Equipment Standards Program, U.S. 

Department of Energy, Building 

Technologies Office, 950 L’Enfant Plaza 

SW, 6th Floor, Washington, DC 20024. 

Telephone: (202) 287–1445. If possible, 

please submit all items on a CD, in 

which case it is not necessary to include 

printed copies. 

No telefacsimiles (‘‘faxes’’) will be 

accepted. For detailed instructions on 

submitting comments and additional 

information on this process, see section 

VII of this document. 

Docket: The docket for this activity, 

which includes Federal Register 

notices, comments, and other 

supporting documents/materials, is 

available for review at 

www.regulations.gov. All documents in 

the docket are listed in the 

www.regulations.gov index. However, 

not all documents listed in the index 

may be publicly available, such as 

information that is exempt from public 

disclosure. 

The docket web page can be found at 

www.regulations.gov/docket/EERE2020-BT-STD-0007. The docket web 

page contains instructions on how to 

access all documents, including public 

comments, in the docket. See section VII 

of this document for information on 

how to submit comments through 

www.regulations.gov. 

EPCA requires the Attorney General 

to provide DOE a written determination 

of whether the proposed standard is 

likely to lessen competition. The U.S. 

Department of Justice Antitrust Division 

invites input from market participants 

and other interested persons with views 

on the likely competitive impact of the 

proposed standard. Interested persons 

may contact the Antitrust Division at 

energy.standards@usdoj.gov on or 

before the date specified in the DATES

section. Please indicate in the ‘‘Subject’’ 

line of your email the title and Docket 

Number of this proposed rulemaking. 

FOR FURTHER INFORMATION CONTACT: 

Mr. Jeremy Dommu, U.S. Department 

of Energy, Office of Energy Efficiency 

and Renewable Energy, Building 

Technologies Office, EE–5B, 1000 

Independence Avenue SW, Washington, 

DC 20585–0121. Email: 

ApplianceStandardsQuestions@

ee.doe.gov. 

Ms. Kristin Koernig, U.S. Department 

of Energy, Office of the General Counsel, 

GC–33, 1000 Independence Avenue SW, 

Washington, DC 20585–0121. 

Telephone: (202) 586–3593. Email: 

kristin.koernig@hq.doe.gov. 

For further information on how to 

submit a comment, review other public 

comments and the docket, or participate 

in the public meeting, contact the 

Appliance and Equipment Standards 

Program staff at (202) 287–1445 or by 

email: ApplianceStandardsQuestions@

ee.doe.gov. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Synopsis of the Proposed Rule 

A. Benefits and Costs to Consumers 

B. Impact on Manufacturers 

C. National Benefits and Costs 

D. Conclusion 

II. Introduction 

A. Authority 

B. Background 

1. Current Standards 

2. History of Standards Rulemaking for 

ESEMs 

3. Electric Motors Working Group 

Recommended Standard Levels 

C. Deviation From Process Rule 

1. Public Comment Period 

2. Framework Document 

III. General Discussion 

A. Scope of Coverage and Equipment 

Classes 

1. General Scope of Coverage and 

Equipment Classes 

2. Structure of the Regulatory Text 

3. Air-Over Medium Electric Motors and 

Air-Over ESEMs 

B. Test Procedure 

C. Represented Values 

D. Technological Feasibility 

1. General 

2. Maximum Technologically Feasible 

Levels 

E. Energy Savings 

1. Determination of Savings 

2. Significance of Savings 

F. Economic Justification 

1. Specific Criteria 

a. Economic Impact on Manufacturers and 

Consumers 

b. Savings in Operating Costs Compared To 

Increase in Price (LCC and PBP) 

c. Energy Savings 

d. Lessening of Utility or Performance of 

Products 

e. Impact of Any Lessening of Competition 

f. Need for National Energy Conservation 

g. Other Factors 

2. Rebuttable Presumption 

IV. Methodology and Discussion of Related 

Comments 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87063 

1All references to EPCA in this document refer 

to the statute as amended through the Energy Act 

of 2020, Public Law 116–260 (Dec. 27, 2020), which 

reflect the last statutory amendments that impact 

Parts A and A–1 of EPCA. 

2For editorial reasons, upon codification in the 

U.S. Code, Part C was re-designated Part A–1. 

3 In the letter, this category is referred to as 

‘‘SNEM.’’ See discussion on the change in 

terminology in sections III.A and III.B of this 

document. 

4Full recommendation available at: 

www.regulations.gov/comment/EERE-2020-BT-STD0007-0038. 

5The members of the Electric Motors Working 

Group included American Council for an EnergyEfficient Economy, Appliance Standards Awareness 

Project, National Electrical Manufacturers 

Association, Natural Resources Defense Council, 

Northwest Energy Efficiency Alliance, Pacific Gas & 

Electric Company, San Diego Gas & Electric, and 

Southern California Edison. 

A. Market and Technology Assessment 

1. Scope of Coverage 

2. Air-Over ESEMs 

3. Equipment Classes 

4. Technology Options 

5. Imported Embedded Motors 

B. Screening Analysis 

1. Screened-Out Technologies 

2. Remaining Technologies 

C. Engineering Analysis 

1. Efficiency Analysis 

a. Representative Units Analyzed 

b. Baseline Efficiency 

c. Higher Efficiency Levels 

2. Cost Analysis 

3. Technical Specifications 

4. Cost-Efficiency Results 

5. Scaling Methodology 

D. Markups Analysis 

E. Energy Use Analysis 

1. Consumer Sample 

2. Motor Input Power 

3. Annual Operating Hours 

4. Impact of Electric Motor Speed 

F. Life-Cycle Cost and Payback Period 

Analysis 

1. Equipment Cost 

2. Installation Cost 

3. Annual Energy Consumption 

4. Energy Prices 

5. Maintenance and Repair Costs 

6. Equipment Lifetime 

7. Discount Rates 

8. Energy Efficiency Distribution in the NoNew-Standards Case 

9. Payback Period Analysis 

G. Shipments Analysis 

H. National Impact Analysis 

1. Equipment Efficiency Trends 

2. National Energy Savings 

3. Net Present Value Analysis 

I. Consumer Subgroup Analysis 

J. Manufacturer Impact Analysis 

1. Overview 

2. Government Regulatory Impact Model 

and Key Inputs 

a. Manufacturer Production Costs 

b. Shipments Projections 

c. Product and Capital Conversion Costs 

d. Manufacturer Markup Scenarios 

3. Manufacturer Interviews 

K. Emissions Analysis 

1. Air Quality Regulations Incorporated in 

DOE’s Analysis 

L. Monetizing Emissions Impacts 

1. Monetization of Greenhouse Gas 

Emissions 

a. Social Cost of Carbon 

b. Social Cost of Methane and Nitrous 

Oxide 

2. Monetization of Other Emissions 

Impacts 

M. Utility Impact Analysis 

N. Employment Impact Analysis 

V. Analytical Results and Conclusions 

A. Trial Standard Levels 

B. Economic Justification and Energy 

Savings 

1. Economic Impacts on Individual 

Consumers 

a. Life-Cycle Cost and Payback Period 

b. Consumer Subgroup Analysis 

c. Rebuttable Presumption Payback 

2. Economic Impacts on Manufacturers 

a. Industry Cash Flow Analysis Results 

b. Direct Impacts on Employment 

c. Impacts on Manufacturing Capacity 

d. Impacts on Subgroups of Manufacturers 

e. Cumulative Regulatory Burden 

3. National Impact Analysis 

a. Significance of Energy Savings 

b. Net Present Value of Consumer Costs 

and Benefits 

c. Indirect Impacts on Employment 

4. Impact on Utility or Performance of 

Products 

5. Impact of Any Lessening of Competition 

6. Need of the Nation To Conserve Energy 

7. Other Factors 

8. Summary of Economic Impacts 

C. Conclusion 

1. Benefits and Burdens of TSLs 

Considered for ESEM Standards 

2. Annualized Benefits and Costs of the 

Proposed Standards 

D. Reporting, Certification, and Sampling 

Plan 

VI. Procedural Issues and Regulatory Review 

A. Review Under Executive Orders 12866, 

13563, and 14094 

B. Review Under the Regulatory Flexibility 

Act 

1. Description of Reasons Why Action Is 

Being Considered 

2. Objectives of, and Legal Basis for, Rule 

3. Description and Estimated Number of 

Small Entities Regulated 

4. Description and Estimate of Compliance 

Requirements Including Differences in 

Cost, if Any, for Different Groups of 

Small Entities 

5. Duplication, Overlap, and Conflict With 

Other Rules and Regulations 

6. Significant Alternatives to the Rule 

C. Review Under the Paperwork Reduction 

Act 

D. Review Under the National 

Environmental Policy Act of 1969 

E. Review Under Executive Order 13132 

F. Review Under Executive Order 12988 

G. Review Under the Unfunded Mandates 

Reform Act of 1995 

H. Review Under the Treasury and General 

Government Appropriations Act, 1999 

I. Review Under Executive Order 12630 

J. Review Under the Treasury and General 

Government Appropriations Act, 2001 

K. Review Under Executive Order 13211 

L. Information Quality 

VII. Public Participation 

A. Attendance at the Public Meeting 

B. Procedure for Submitting Prepared 

General Statements for Distribution 

C. Conduct of the Public Meeting 

D. Submission of Comments 

E. Issues on Which DOE Seeks Comment 

VIII. Approval of the Office of the Secretary 

I. Synopsis of the Proposed Rule 

The Energy Policy and Conservation 

Act, Public Law 94–163, as amended 

(‘‘EPCA’’),1 authorizes DOE to regulate 

the energy efficiency of a number of 

consumer products and certain 

industrial equipment. (42 U.S.C. 6291– 

6317) Title III, Part C2 of EPCA 

established the Energy Conservation 

Program for Certain Industrial 

Equipment. (42 U.S.C. 6311–6317) Such 

equipment includes electric motors. 

Expanded scope electric motors 

(‘‘ESEMs’’), a subcategory of electric 

motors, are the subject of this 

rulemaking. This proposed rulemaking 

does not address small electric motors 

that are covered under title 10 of the 

Code of Federal Regulations (‘‘CFR’’) 

part 431 subpart X. 

Pursuant to EPCA, any new or 

amended energy conservation standard 

must be designed to achieve the 

maximum improvement in energy 

efficiency that DOE determines is 

technologically feasible and 

economically justified. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(2)(A)) 

Furthermore, the new or amended 

standard must result in significant 

conservation of energy. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(3)(B)) 

In accordance with these and other 

statutory provisions discussed in this 

document, DOE analyzed the benefits 

and burdens of four trial standard levels 

(‘‘TSLs’’) for ESEMs. The TSLs and their 

associated benefits and burdens are 

discussed in detail in sections V.A 

through V.C of this document. As 

discussed in section V.C of this 

document, DOE has tentatively 

determined that TSL 2 represents the 

maximum improvement in energy 

efficiency that is technologically 

feasible and economically justified. The 

proposed standards, which are 

expressed in average full-load 

efficiency, are shown in Table I–1 

through Table I–3 and are equivalent to 

those recommended in a joint 

recommendation for energy 

conservation standards for ESEMs 3

(‘‘December 2022 Joint 

Recommendation’’) from the Electric 

Motors Working Group, representing the 

motors industry, energy efficiency 

organizations and utilities.4 5

Upon receipt of the December 2022 

Joint Recommendation, DOE considered 

whether the statutory requirements of 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87064 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

42 U.S.C. 6295(p)(4) would be satisfied 

and thus warrant the issuance of a direct 

final rule by DOE. In particular, EPCA 

requires DOE to determine whether the 

recommended standard contained in a 

statement submitted jointly by 

interested parties is in accordance with 

42 U.S.C. 6295(o); i.e., whether the 

recommended standard would achieve 

the maximum improvement in energy 

efficiency that is technologically 

feasible and economically justified. (42 

U.S.C. 6295(p)(4)(A)(i)) If the Secretary 

determines the recommended standard 

is in accordance with 42 U.S.C. 6295(o), 

the Secretary may issue a final rule that 

establishes the recommended energy 

conservation standard. (Id.) If the 

Secretary determines that a direct final 

rule cannot be issued based on the 

statement, the Secretary must publish a 

notice of the determination, together 

with an explanation of the reasons for 

such determination. (42 U.S.C. 

6295(p)(4)(A)(ii)) EPCA defines seven 

factors by which DOE must determine 

whether a proposed standard is 

economically justified. (42 U.S.C. 

6295(o)(2)(B)(i)(I)–(VII)) Having 

considered the December 2022 Joint 

Recommendation, DOE has tentatively 

determined that the recommended 

standard is in accordance with 42 U.S.C. 

6295(o). However, because EPCA does 

not require DOE to issue a direct final 

rule under 42 U.S.C. 6295(p), DOE is 

interested in seeking public comment 

on the proposed, and recommended, 

standards level through this proposed 

rule to better understand the impacts of 

those standards. 

These proposed standards, if adopted, 

would apply to all ESEMs listed in 

Table I–1 through Table I–3 

manufactured in, or imported into, the 

United States starting on January 1, 

2029. 

TABLE I–1—PROPOSED ENERGY CONSERVATION STANDARDS FOR HIGH AND MEDIUM-TORQUE ESEMS

[Compliance Starting on January 1, 2029] [Recommended TSL 2] 

hp 

Average full load efficiency 

Open Enclosed 

2-pole 4-pole 6-pole 8-pole 2-pole 4-pole 6-pole 8-pole 

0.25 .................................................................. 59.5 59.5 57.5 ................ 59.5 59.5 57.5 ................

0.33 .................................................................. 64.0 64.0 62.0 50.5 64.0 64.0 62.0 50.5 

0.5 .................................................................... 68.0 69.2 68.0 52.5 68.0 67.4 68.0 52.5 

0.75 .................................................................. 76.2 81.8 80.2 72.0 75.5 75.5 75.5 72.0 

1 ....................................................................... 80.4 82.6 81.1 74.0 77.0 80.0 77.0 74.0 

1.5 .................................................................... 81.5 83.8 ................ ................ 81.5 81.5 80.0 ................

2 ....................................................................... 82.9 84.5 ................ ................ 82.5 82.5 ................ ................

3 ....................................................................... 84.1 ................ ................ ................ 84.0 ................ ................ ................

TABLE I–2—PROPOSED ENERGY CONSERVATION STANDARDS FOR LOW-TORQUE ESEMS

[Compliance Starting on January 1, 2029] [Recommended TSL 2] 

hp 

Average full load efficiency 

Open Enclosed 

2-pole 4-pole 6-pole 8-pole 2-pole 4-pole 6-pole 8-pole 

0.25 .................................................................. 63.9 66.1 60.2 52.5 60.9 64.1 59.2 52.5 

0.33 .................................................................. 66.9 69.7 65.0 56.6 63.9 67.7 64.0 56.6 

0.5 .................................................................... 68.8 70.1 66.8 57.1 65.8 68.1 65.8 57.1 

0.75 .................................................................. 70.5 74.8 73.1 62.8 67.5 72.8 72.1 62.8 

1 ....................................................................... 74.3 77.1 77.3 65.7 71.3 75.1 76.3 65.7 

1.5 .................................................................... 79.9 82.1 80.5 72.2 76.9 80.1 79.5 72.2 

2 ....................................................................... 81.0 82.9 81.4 73.3 78.0 80.9 80.4 73.3 

3 ....................................................................... 82.4 84.0 82.5 74.9 79.4 82.0 81.5 74.9 

TABLE I–3—PROPOSED ENERGY CONSERVATION STANDARDS FOR POLYPHASE ESEMS

[Compliance Starting on January 1, 2029] [Recommended TSL 2] 

hp 

Average full load efficiency 

Open Enclosed 

2-pole 4-pole 6-pole 8-pole 2-pole 4-pole 6-pole 8-pole 

0.25 .................................................................. 65.6 69.5 67.5 62.0 66.0 68.0 66.0 62.0 

0.33 .................................................................. 69.5 73.4 71.4 64.0 70.0 72.0 70.0 64.0 

0.5 .................................................................... 73.4 78.2 75.3 66.0 72.0 75.5 72.0 66.0 

0.75 .................................................................. 76.8 81.1 81.7 70.0 75.5 77.0 74.0 70.0 

1 ....................................................................... 77.0 83.5 82.5 75.5 75.5 77.0 74.0 75.5 

1.5 .................................................................... 84.0 86.5 83.8 77.0 84.0 82.5 87.5 78.5 

2 ....................................................................... 85.5 86.5 ................ 86.5 85.5 85.5 88.5 84.0 

3 ....................................................................... 85.5 86.9 ................ 87.5 86.5 86.5 89.5 85.5 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87065 

6The average LCC savings refer to consumers that 

are affected by a standard and are measured relative 

to the efficiency distribution in the no-newstandards case, which depicts the market in the 

compliance year in the absence of new standards 

(see section IV.F.9 of this document). The simple 

PBP, which is designed to compare specific 

efficiency levels, is measured relative to the 

baseline product (see section IV.C of this 

document). 

7All monetary values in this document are 

expressed in 2022 dollars. 

8The quantity refers to full-fuel-cycle (‘‘FFC’’) 

energy savings. FFC energy savings includes the 

energy consumed in extracting, processing, and 

transporting primary fuels (i.e., coal, natural gas, 

petroleum fuels), and, thus, presents a more 

complete picture of the impacts of energy efficiency 

standards. For more information on the FFC metric, 

see section IV.H.1 of this document. 

9A metric ton is equivalent to 1.1 short tons. 

Results for emissions other than CO2 are presented 

in short tons. 

10 DOE calculated emissions reductions relative 

to the no-new-standards case, which reflects key 

assumptions in the Annual Energy Outlook 2023 

(‘‘AEO2023’’). AEO2023 reflects, to the extent 

possible, laws and regulations adopted through 

mid-November 2022, including the Inflation 

Reduction Act. See section IV.K of this document 

for further discussion of AEO2023 assumptions that 

effect air pollutant emissions. 

11To monetize the benefits of reducing GHG 

emissions this analysis uses the interim estimates 

presented in the Technical Support Document: 

Social Cost of Carbon, Methane, and Nitrous Oxide 

Interim Estimates Under Executive Order 13990 

published in February 2021 by the IWG. (‘‘February 

2021 SC–GHG TSD’’). www.whitehouse.gov/wpcontent/uploads/2021/02/ 

TechnicalSupportDocument_

SocialCostofCarbonMethaneNitrousOxide.pdf. 

A. Benefits and Costs to Consumers 

Table I–4 presents DOE’s evaluation 

of the economic impacts of the proposed 

standards on consumers of ESEMs, as 

measured by the average life-cycle cost 

(‘‘LCC’’) savings and the simple payback 

period (‘‘PBP’’).6 The average LCC 

savings are positive for all 

representative units, and the PBP is less 

than the average lifetime of ESEMs, 

which is estimated to be 7.1 years (see 

section IV.F of this document). 

TABLE I–4—IMPACTS OF PROPOSED ENERGY CONSERVATION STANDARDS ON CONSUMERS OF ESEMS

Representative unit Average LCC savings 

(2022$) 

Simple payback period 

(years) 

ESEM High/Med Torque, 4 poles, enclosed, 0.25 hp ............................................................. 51 1.1 

ESEM High/Med Torque, 4 poles, enclosed, 1 hp .................................................................. 138 0.9 

ESEM High/Med Torque, 4 poles, enclosed, 5 hp .................................................................. 147 0.7 

ESEM Low Torque, 6 poles, enclosed, 0.25 hp ..................................................................... 100 1.5 

ESEM Low Torque, 6 poles, enclosed, 0.5 hp ....................................................................... 26 2.0 

ESEM Polyphase, 4 poles, enclosed, 0.25 hp ........................................................................ 83 0.8 

AO–ESEM High/Med Torque, 4 poles, enclosed, 0.25 hp ..................................................... 160 0.8 

AO–ESEM High/Med Torque, 4 poles, enclosed, 1 hp .......................................................... 121 0.7 

AO–ESEM High/Med Torque, 4 poles, enclosed, 5 hp .......................................................... 88 1.3 

AO–ESEM Low Torque, 6 poles, enclosed, 0.25 hp .............................................................. 40 1.8 

AO–ESEM Low Torque, 6 poles, enclosed, 0.5 hp ................................................................ 51 1.2 

AO–ESEM Polyphase, 4 poles, enclosed, 0.25 hp ................................................................. 138 1.1 

DOE’s analysis of the impacts of the 

proposed standards on consumers is 

described in section IV.F of this 

document. 

B. Impact on Manufacturers 

The industry net present value 

(‘‘INPV’’) is the sum of the discounted 

cash flows to the industry from the base 

year through the end of the analysis 

period (2024–2058). Using a real 

discount rate of 9.1 percent, DOE 

estimates that the INPV for 

manufacturers of ESEMs in the case 

without new standards is $2,019 million 

in 2022$. Under the proposed 

standards, DOE estimates the change in 

INPV to range from ¥13.1 percent to 

¥6.5 percent, which is approximately 

¥$264 million to ¥$131 million. In 

order to bring equipment into 

compliance with new standards, it is 

estimated that industry will incur total 

conversion costs of $339 million. 

DOE’s analysis of the impacts of the 

proposed standards on manufacturers is 

described in section IV.J of this 

document. The analytic results of the 

manufacturer impact analysis (‘‘MIA’’) 

are presented in section V.B.2 of this 

document. 

C. National Benefits and Costs 7

DOE’s analyses indicate that the 

proposed energy conservation standards 

for ESEMs would save a significant 

amount of energy. Relative to the case 

without new standards, the lifetime 

energy savings for ESEMs purchased in 

the 30-year period that begins in the 

anticipated year of compliance with the 

new standards (2029–2058) amount to 

8.9 quadrillion British thermal units 

(‘‘Btu’’), or quads.8 This represents a 

savings of 9 percent relative to the 

energy use of these products in the case 

without new standards (referred to as 

the ‘‘no-new-standards case’’). 

The cumulative net present value 

(‘‘NPV’’) of total consumer benefits of 

the proposed standards for ESEMs 

ranges from $38.3 billion (at a 7-percent 

discount rate) to $72.8 billion (at a 3- 

percent discount rate). This NPV 

expresses the estimated total value of 

future operating-cost savings minus the 

estimated increased equipment and 

installation costs for ESEMs purchased 

in 2029–2058. 

In addition, the proposed standards 

for ESEMs are projected to yield 

significant environmental benefits. DOE 

estimates that the proposed standards 

would result in cumulative emission 

reductions (over the same period as for 

energy savings) of 160.5 million metric 

tons (‘‘Mt’’) 9 of carbon dioxide (‘‘CO2’’), 

43.8 thousand tons of sulfur dioxide 

(‘‘SO2’’), 299.8 thousand tons of nitrogen 

oxides (‘‘NOX’’), 1,362.2 thousand tons 

of methane (‘‘CH4’’), 1.4 thousand tons 

of nitrous oxide (‘‘N2O’’), and 0.3 tons 

of mercury (‘‘Hg’’).10

DOE estimates the value of climate 

benefits from a reduction in greenhouse 

gases (‘‘GHG’’) using four different 

estimates of the social cost of CO2 (‘‘SC– 

CO2’’), the social cost of methane (‘‘SC– 

CH4’’), and the social cost of nitrous 

oxide (‘‘SC–N2O’’). Together these 

represent the social cost of GHG (‘‘SC– 

GHG’’). DOE used interim SC–GHG 

values (in terms of benefit per ton of 

GHG avoided) developed by an 

Interagency Working Group on the 

Social Cost of Greenhouse Gases 

(‘‘IWG’’).11 The derivation of these 

values is discussed in section IV.L of 

this document. For presentational 

purposes, the climate benefits 

associated with the average SC–GHG at 

a 3-percent discount rate are estimated 

to be $9.4 billion. DOE does not have a 

single central SC–GHG point estimate 

and it emphasizes the importance and 

value of considering the benefits 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87066 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

12U.S. EPA. Estimating the Benefit per Ton of 

Reducing Directly Emitted PM2.5, PM2.5 Precursors 

and Ozone Precursors from 21 Sectors. Available at 

www.epa.gov/benmap/estimating-benefit-tonreducing-pm25-precursors-21-sectors. 

13 DOE estimates the economic value of these 

emissions reductions resulting from the considered 

TSLs for the purpose of complying with the 

requirements of Executive Order 12866. 

calculated using all four sets of SC–GHG 

estimates. 

DOE estimated the monetary health 

benefits of SO2 and NOX emissions 

reductions using benefit per ton 

estimates from the Environmental 

Protection Agency (‘‘EPA’’),12 as 

discussed in section IV.L of this 

document. DOE estimated the present 

value of the health benefits would be 

$7.9 billion using a 7-percent discount 

rate, and $18.3 billion using a 3-percent 

discount rate.13 DOE is currently only 

monetizing health benefits from changes 

in ambient fine particulate matter 

(‘‘PM2.5’’) concentrations from two 

precursors (SO2 and NOX), and from 

changes in ambient ozone from one 

precursor (for NOX), but will continue to 

assess the ability to monetize other 

effects such as health benefits from 

reductions in direct PM2.5 emissions. 

Table I–5 summarizes the monetized 

benefits and costs expected to result 

from the proposed standards for ESEMs. 

There are other important unquantified 

effects, including certain unquantified 

climate benefits, unquantified public 

health benefits from the reduction of 

toxic air pollutants and other emissions, 

unquantified energy security benefits, 

and distributional effects, among others. 

TABLE I–5—SUMMARY OF MONETIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR

ESEMS

[TSL 2] 

Billion $2022 

3% discount rate 

Consumer Operating Cost Savings ................................................................................................................................................... 54.7 

Climate Benefits * ............................................................................................................................................................................... 9.4 

Health Benefits ** ............................................................................................................................................................................... 18.3 

Total Benefits † .................................................................................................................................................................................. 82.4 

Consumer Incremental Equipment Costs ‡ ....................................................................................................................................... 9.7 

Net Benefits ....................................................................................................................................................................................... 72.8 

Change in Producer Cashflow (INPV ††) .......................................................................................................................................... (0.3)–(0.1) 

7% discount rate 

Consumer Operating Cost Savings ................................................................................................................................................... 26.1 

Climate Benefits * (3% discount rate) ................................................................................................................................................ 9.4 

Health Benefits ** ............................................................................................................................................................................... 7.9 

Total Benefits † .................................................................................................................................................................................. 43.5 

Consumer Incremental Equipment Costs ‡ ....................................................................................................................................... 5.1 

Net Benefits ....................................................................................................................................................................................... 38.3 

Change in Producer Cashflow (INPV ††) .......................................................................................................................................... (0.3)–(0.1) 

Note: This table presents the costs and benefits associated with ESEMs shipped in 2029–2058. These results include consumer, climate, and 

health benefits which accrue after 2029 from the equipment shipped in 2029–2058. 

* Climate benefits are calculated using four different estimates of the social cost of carbon (SC–CO2), methane (SC–CH4), and nitrous oxide 

(SC–N2O) (model average at 2.5 percent, 3 percent, and 5 percent discount rates; 95th percentile at 3 percent discount rate) (see section IV.L of 

this document). Together these represent the global SC–GHG. For presentational purposes of this table, the climate benefits associated with the 

average SC–GHG at a 3 percent discount rate are shown; however, DOE emphasizes the importance and value of considering the benefits calculated using all four sets of SC–GHG estimates. To monetize the benefits of reducing GHG emissions, this analysis uses the interim estimates 

presented in the Technical Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates Under Executive Order 

13990 published in February 2021 by the IWG 

** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as 

health benefits from reductions in direct PM2.5 emissions. See section IV.L of this document for more details. 

† Total and net benefits include those consumer, climate, and health benefits that can be quantified and monetized. For presentation purposes, 

total and net benefits for both the 3-percent and 7-percent cases are presented using the average SC–GHG with 3-percent discount rate. 

‡ Costs include incremental equipment costs. 

†† Operating Cost Savings are calculated based on the life cycle costs analysis and national impact analysis as discussed in detail below. See 

sections IV.F and IV.H of this document. DOE’s national impacts analysis includes all impacts (both costs and benefits) along the distribution 

chain beginning with the increased costs to the manufacturer to manufacture the equipment and ending with the increase in price experienced by 

the consumer. DOE also separately conducts a detailed analysis on the impacts on manufacturers (the MIA). See section IV.J of this document. 

In the detailed MIA, DOE models manufacturers’ pricing decisions based on assumptions regarding investments, conversion costs, cashflow, and 

margins. The MIA produces a range of impacts, which is the rule’s expected impact on the INPV. The change in INPV is the present value of all 

changes in industry cash flow, including changes in production costs, capital expenditures, and manufacturer profit margins. Change in INPV is 

calculated using the industry weighted average cost of capital value of 9.1 percent that is estimated in the MIA (see chapter 12 of the NOPR 

TSD for a complete description of the industry weighted average cost of capital). For ESEMs, those values are ¥$264 million and ¥$131 million. DOE accounts for that range of likely impacts in analyzing whether a TSL is economically justified. See section IV.J of this document. DOE 

is presenting the range of impacts to the INPV under two markup scenarios: the Preservation of Gross Margin scenario, which is the manufacturer markup scenario used in the calculation of Consumer Operating Cost Savings in this table, and the Preservation of Operating Profit scenario, where DOE assumed manufacturers would not be able to increase per-unit operating profit in proportion to increases in manufacturer production costs. DOE includes the range of estimated INPV in the above table, drawing on the MIA explained further in section IV.J of this document, to provide additional context for assessing the estimated impacts of this rule to society, including potential changes in production and consumption, which is consistent with OMB’s Circular A–4 and E.O. 12866. If DOE were to include the INPV into the net benefit calculation for this 

proposed rule, the net benefits would range from $72.5 billion to $72.7 billion at 3-percent discount rate and would range from $38.0 billion to 

$38.2 billion at 7-percent discount rate. Numbers in parentheses are negative numbers. DOE seeks comment on this approach. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87067 

14To convert the time-series of costs and benefits 

into annualized values, DOE calculated a present 

value in 2022, the year used for discounting the 

NPV of total consumer costs and savings. For the 

benefits, DOE calculated a present value associated 

with each year’s shipments in the year in which the 

shipments occur (e.g., 2030), and then discounted 

the present value from each year to 2022. Using the 

present value, DOE then calculated the fixed annual 

payment over a 30-year period, starting in the 

compliance year, that yields the same present value. 

The benefits and costs of the proposed 

standards can also be expressed in terms 

of annualized values. The monetary 

values for the total annualized net 

benefits are (1) the reduced consumer 

operating costs, minus (2) the increase 

in product purchase prices and 

installation costs, plus (3) the value of 

climate and health benefits of emission 

reductions, all annualized.14

The national operating cost savings 

are domestic private U.S. consumer 

monetary savings that occur as a result 

of purchasing the covered products and 

are measured for the lifetime of ESEMs 

shipped in 2029–2058. The benefits 

associated with reduced emissions 

achieved as a result of the proposed 

standards are also calculated based on 

the lifetime of ESEMs shipped in 2029– 

2058. Total benefits for both the 3- 

percent and 7-percent cases are 

presented using the average GHG social 

costs with 3-percent discount rate. 

Estimates of SC–GHG values are 

presented for all four discount rates in 

section V.B of this document. 

Table I–6 presents the total estimated 

monetized benefits and costs associated 

with the proposed standard, expressed 

in terms of annualized values. The 

results under the primary estimate are 

as follows. 

Using a 7-percent discount rate for 

consumer benefits and costs and health 

benefits from reduced NOX and SO2

emissions, and the 3-percent discount 

rate case for climate benefits from 

reduced GHG emissions, the estimated 

cost of the standards proposed in this 

rule is $543 million per year in 

increased equipment costs, while the 

estimated annual benefits are $2,757 

million in reduced equipment operating 

costs, $542 million in climate benefits, 

and $836 million in health benefits. In 

this case. The net benefit would amount 

to $3,592 million per year. 

Using a 3-percent discount rate for all 

benefits and costs, the estimated cost of 

the proposed standards is $556 million 

per year in increased equipment costs, 

while the estimated annual benefits are 

$3,140 million in reduced operating 

costs, $542 million in climate benefits, 

and $1,052 million in health benefits. In 

this case, the net benefit would amount 

to $4,179 million per year. 

TABLE I–6—ANNUALIZED BENEFITS AND COSTS OF PROPOSED ENERGY CONSERVATION STANDARDS FOR ESEMS

[TSL 2] 

Million 2022$/year 

Primary 

estimate 

Low-netbenefits 

estimate 

High-netbenefits 

estimate 

3% discount rate 

Consumer Operating Cost Savings ............................................................................................. 3,140 2,962 3,341 

Climate Benefits * ......................................................................................................................... 542 526 562 

Health Benefits ** ......................................................................................................................... 1,052 1,021 1,089 

Total Benefits † ............................................................................................................................ 4,734 4,509 4,992 

Consumer Incremental Equipment Costs ‡ ................................................................................. 556 598 529 

Net Benefits ................................................................................................................................. 4,179 3,911 4,464 

Change in Producer Cashflow (INPV ††) .................................................................................... (25)–(13) (25)–(13) (25)–(13) 

7% discount rate 

Consumer Operating Cost Savings ............................................................................................. 2,757 2,615 2,921 

Climate Benefits * (3% discount rate) .......................................................................................... 542 526 562 

Health Benefits ** ......................................................................................................................... 836 814 863 

Total Benefits † ............................................................................................................................ 4,135 3,955 4,346 

Consumer Incremental Equipment Costs ‡ ................................................................................. 543 578 520 

Net Benefits ................................................................................................................................. 3,592 3,377 3,826 

Change in Producer Cashflow (INPV ††) .................................................................................... (25)–(13) (25)–(13) (25)–(13) 

Note: This table presents the costs and benefits associated with ESEMs shipped in 2029–2058. These results include consumer, climate, and 

health benefits which accrue after 2058 from the equipment shipped in 2029–2058. The Primary, Low Net Benefits, and High Net Benefits Estimates utilize projections of energy prices from the AEO2023 Reference case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental equipment costs reflect a constant rate in the Primary Estimate, an increasing rate in the Low Net Benefits 

Estimate, and a declining rate in the High Net Benefits Estimate. The methods used to derive projected price trends are explained in sections 

IV.F and IV.4 of this document. Note that the Benefits and Costs may not sum to the Net Benefits due to rounding. 

* Climate benefits are calculated using four different estimates of the global SC–GHG (see section IV.L of this document). For presentational 

purposes of this table, the climate benefits associated with the average SC–GHG at a 3 percent discount rate are shown; however, DOE emphasizes the importance and value of considering the benefits calculated using all four sets of SC–GHG estimates. To monetize the benefits of reducing GHG emissions, this analysis uses the interim estimates presented in the Technical Support Document: Social Cost of Carbon, Methane, 

and Nitrous Oxide Interim Estimates Under Executive Order 13990 published in February 2021 by the IWG. 

** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits but will continue to assess the ability to monetize other effects such as 

health benefits from reductions in direct PM2.5 emissions. See section IV.L of this document for more details. 

† Total benefits for both the 3-percent and 7-percent cases are presented using the average SC–GHG with 3-percent discount rate.

‡ Costs include incremental equipment costs. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87068 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

15Procedures, Interpretations, and Policies for 

Consideration in New or Revised Energy 

Conservation Standards and Test Procedures for 

Consumer Products and Commercial/Industrial 

Equipment, 86 FR 70892, 70901 (Dec. 13, 2021). 

†† Operating Cost Savings are calculated based on the life cycle costs analysis and national impact analysis as discussed in detail below. See 

sections IV.F and IV.H of this document. DOE’s national impacts analysis includes all impacts (both costs and benefits) along the distribution 

chain beginning with the increased costs to the manufacturer to manufacture the equipment and ending with the increase in price experienced by 

the consumer. DOE also separately conducts a detailed analysis on the impacts on manufacturers (the MIA). See section IV.J. of this document. 

In the detailed MIA, DOE models manufacturers’ pricing decisions based on assumptions regarding investments, conversion costs, cashflow, and 

margins. The MIA produces a range of impacts, which is the rule’s expected impact on the INPV. The change in INPV is the present value of all 

changes in industry cash flow, including changes in production costs, capital expenditures, and manufacturer profit margins. The annualized 

change in INPV is calculated using the industry weighted average cost of capital value of 9.1 percent that is estimated in the MIA (see chapter 

12 of the NOPR TSD for a complete description of the industry weighted average cost of capital). For ESEMs, those values are ¥$25 million 

and ¥$13 million. DOE accounts for that range of likely impacts in analyzing whether a TSL is economically justified. See section IV.J of this 

NOPR. DOE is presenting the range of impacts to the INPV under two markup scenarios: the Preservation of Gross Margin scenario, which is 

the manufacturer markup scenario used in the calculation of Consumer Operating Cost Savings in this table, and the Preservation of Operating 

Profit Markup scenario, where DOE assumed manufacturers would not be able to increase per-unit operating profit in proportion to increases in 

manufacturer production costs. DOE includes the range of estimated annualized change in INPV in the above table, drawing on the MIA explained further in section IV.J of this document to provide additional context for assessing the estimated impacts of this rule to society, including 

potential changes in production and consumption, which is consistent with OMB’s Circular A–4 and E.O. 12866. If DOE were to include the INPV 

into the annualized net benefit calculation for this proposed rule, the annualized net benefits would range from $4,154 million to $4,166 million at 

3-percent discount rate and would range from $3,567 million to $3,579 million at 7-percent discount rate. Numbers in parentheses are negative 

numbers. DOE seeks comment on this approach. 

DOE’s analysis of the national impacts 

of the proposed standards is described 

in sections IV.G, IV.K, and IV.L of this 

document. 

D. Conclusion 

DOE has tentatively concluded that 

the proposed standards represent the 

maximum improvement in energy 

efficiency that is technologically 

feasible and economically justified, and 

would result in the significant 

conservation of energy. Specifically, 

with regards to technological feasibility, 

equipment achieving these standard 

levels are already commercially 

available for all equipment classes 

covered by this proposal. As for 

economic justification, DOE’s analysis 

shows that the benefits of the proposed 

standard exceed, to a great extent, the 

burdens of the proposed standards. 

Using a 7-percent discount rate for 

consumer benefits and costs and NOX

and SO2 reduction benefits, and a 3- 

percent discount rate case for GHG 

social costs, the estimated cost of the 

proposed standards for ESEMs is $543 

million per year in increased equipment 

costs, while the estimated annual 

benefits are $2,757 million in reduced 

equipment operating costs, $542 million 

in climate benefits and $836 million in 

health benefits. The net benefit amounts 

to $3,592 million per year. 

The significance of energy savings 

offered by a new or amended energy 

conservation standard cannot be 

determined without knowledge of the 

specific circumstances surrounding a 

given rulemaking.15 For example, some 

covered products and equipment have 

substantial energy consumption occur 

during periods of peak energy demand. 

The impacts of these products on the 

energy infrastructure can be more 

pronounced than products with 

relatively constant demand. 

Accordingly, DOE evaluates the 

significance of energy savings on a caseby-case basis. 

As previously mentioned, the 

standards are projected to result in 

estimated national energy savings of 8.9 

quad FFC, the equivalent of the primary 

annual energy use of 95.7 million 

homes. In addition, they are projected to 

reduce CO2 emissions by 160.5 Mt. 

Based on these findings, DOE has 

initially determined the energy savings 

from the proposed standard levels are 

‘‘significant’’ within the meaning of 42 

U.S.C. 6295(o)(3)(B). A more detailed 

discussion of the basis for these 

tentative conclusions is contained in the 

remainder of this document and the 

accompanying technical support 

document (‘‘TSD’’). 

DOE also considered more-stringent 

energy efficiency levels as potential 

standards, and is still considering them 

in this proposed rulemaking. However, 

DOE has tentatively concluded that the 

potential burdens of the more-stringent 

energy efficiency levels would outweigh 

the projected benefits. 

Based on consideration of the public 

comments DOE receives in response to 

this document and related information 

collected and analyzed during the 

course of this proposed rulemaking 

effort, DOE may adopt energy efficiency 

levels presented in this document that 

are either higher or lower than the 

proposed standards, or some 

combination of level(s) that incorporate 

the proposed standards in part. 

II. Introduction 

The following section briefly 

discusses the statutory authority 

underlying this proposed rule, as well 

as some of the relevant historical 

background related to the establishment 

of standards for ESEMs. 

A. Authority 

EPCA authorizes DOE to regulate the 

energy efficiency of a number of 

consumer products and certain 

industrial equipment. Title III, Part C of 

EPCA, added by Public Law 95–619, 

Title IV, section 441(a), established the 

Energy Conservation Program for 

Certain Industrial Equipment, which 

sets forth a variety of provisions 

designed to improve the energy 

efficiency of certain types of industrial 

equipment, including electric motors. 

(42 U.S.C. 6311(1)(A)) ESEMs, the 

subject of this document, are a category 

of electric motors. 

The Energy Policy Act of 1992 

(‘‘EPACT 1992’’) (Pub. L. 102–486 (Oct. 

24, 1992)) further amended EPCA by 

establishing energy conservation 

standards and test procedures for 

certain commercial and industrial 

electric motors that are manufactured 

alone or as a component of another 

piece of equipment. In December 2007, 

Congress enacted the Energy 

Independence and Security Act of 2007 

(‘‘EISA 2007’’) (Pub. L. 110–140 (Dec. 

19, 2007). Section 313(b)(1) of EISA 

2007 updated the energy conservation 

standards for those electric motors 

already covered by EPCA and 

established energy conservation 

standards for a larger scope of motors 

not previously covered by standards. (42 

U.S.C. 6313(b)(2)) EISA 2007 also 

revised certain statutory definitions 

related to electric motors. See EISA 

2007, sec. 313 (amending statutory 

definitions related to electric motors at 

42 U.S.C. 6311(13)). 

The energy conservation program 

under EPCA, consists essentially of four 

parts: (1) testing, (2) labeling, (3) the 

establishment of Federal energy 

conservation standards, and (4) 

certification and enforcement 

procedures. Relevant provisions of 

EPCA include definitions (42 U.S.C. 

6311), test procedures (42 U.S.C. 6314), 

labeling provisions (42 U.S.C. 6315), 

energy conservation standards (42 

U.S.C. 6313), and the authority to 

require information and reports from 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87069 

manufacturers (42 U.S.C. 6316; U.S.C. 

6296). 

Federal energy efficiency 

requirements for covered equipment 

established under EPCA generally 

supersede state laws and regulations 

concerning energy conservation testing, 

labeling, and standards. (42 U.S.C. 

6316(a) and 42 U.S.C. 6316(b); 42 U.S.C. 

6297) DOE may, however, grant waivers 

of Federal preemption in limited 

instances for particular state laws or 

regulations, in accordance with the 

procedures and other provisions set 

forth under EPCA. (See 42 U.S.C. 

6316(a) (applying the preemption 

waiver provisions of 42 U.S.C. 6297)) 

Subject to certain criteria and 

conditions, DOE is required to develop 

test procedures to measure the energy 

efficiency, energy use, or estimated 

annual operating cost of each covered 

equipment. (See 42 U.S.C. 6316(a); 42 

U.S.C. 6295(o)(3)(A) and (r)) 

Manufacturers of covered equipment 

must use the Federal test procedures as 

the basis for: (1) certifying to DOE that 

their equipment complies with the 

applicable energy conservation 

standards adopted pursuant to EPCA (42 

U.S.C. 6316(a); 42 U.S.C. 6295(s)), and 

(2) making representations about the 

efficiency of that equipment (42 U.S.C. 

6314(d)). Similarly, DOE must use these 

test procedures to determine whether 

the equipment complies with relevant 

standards promulgated under EPCA. (42 

U.S.C. 6316(a); 42 U.S.C. 6295(s)) The 

DOE test procedure for ESEMs appear at 

10 CFR part 431, subpart B, appendix B 

(‘‘appendix B’’). 

DOE must follow specific statutory 

criteria for prescribing new or amended 

standards for covered equipment, 

including ESEMs. Any new or amended 

standard for a covered product must be 

designed to achieve the maximum 

improvement in energy efficiency that 

the Secretary of Energy determines is 

technologically feasible and 

economically justified. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(2)(A)) 

Furthermore, DOE may not adopt any 

standard that would not result in the 

significant conservation of energy. (42 

U.S.C. 6316(a); 42 U.S.C. 6295(o)(3)) 

Moreover, DOE may not prescribe a 

standard (1) for certain equipment, 

including ESEMs, if no test procedure 

has been established for the equipment, 

or (2) if DOE determines by rule that the 

standard is not technologically feasible 

or economically justified. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(3)(A)–(B)) In 

deciding whether a proposed standard 

is economically justified, DOE must 

determine whether the benefits of the 

standard exceed its burdens. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(3)(A)–(B)) 

DOE must make this determination after 

receiving comments on the proposed 

standard, and by considering, to the 

greatest extent practicable, the following 

seven statutory factors: 

(1) The economic impact of the 

standard on manufacturers and 

consumers of the products subject to the 

standard; 

(2) The savings in operating costs 

throughout the estimated average life of 

the covered products in the type (or 

class) compared to any increase in the 

price, initial charges, or maintenance 

expenses for the covered products that 

are likely to result from the standard; 

(3) The total projected amount of 

energy (or as applicable, water) savings 

likely to result directly from the 

standard; 

(4) Any lessening of the utility or the 

performance of the covered products 

likely to result from the standard; 

(5) The impact of any lessening of 

competition, as determined in writing 

by the Attorney General, that is likely to 

result from the standard; 

(6) The need for national energy and 

water conservation; and 

(7) Other factors the Secretary of 

Energy (‘‘Secretary’’) considers relevant. 

(42 U.S.C. 6316(a); 42 U.S.C. 

6295(o)(2)(B)(i)(I)–(VII)) 

Further, EPCA establishes a rebuttable 

presumption that a standard is 

economically justified if the Secretary 

finds that the additional cost to the 

consumer of purchasing a product 

complying with an energy conservation 

standard level will be less than three 

times the value of the energy savings 

during the first year that the consumer 

will receive as a result of the standard, 

as calculated under the applicable test 

procedure. (42 U.S.C. 6316(a); 42 U.S.C. 

6295(o)(2)(B)(iii)) 

EPCA also contains what is known as 

an ‘‘anti-backsliding’’ provision, which 

prevents the Secretary from prescribing 

any amended standard that either 

increases the maximum allowable 

energy use or decreases the minimum 

required energy efficiency of a covered 

product. (42 U.S.C. 6316(a); 42 U.S.C. 

6295(o)(1)) Also, the Secretary may not 

prescribe an amended or new standard 

if interested persons have established by 

a preponderance of the evidence that 

the standard is likely to result in the 

unavailability in the United States in 

any covered product type (or class) of 

performance characteristics (including 

reliability), features, sizes, capacities, 

and volumes that are substantially the 

same as those generally available in the 

United States. (42 U.S.C. 6316(a); 42 

U.S.C. 6295(o)(4)) 

Additionally, EPCA specifies 

requirements when promulgating an 

energy conservation standard for a 

covered product or equipment that has 

two or more subcategories. DOE must 

specify a different standard level for a 

type or class of product that has the 

same function or intended use, if DOE 

determines that products within such 

group: (A) consume a different kind of 

energy from that consumed by other 

covered products within such type (or 

class); or (B) have a capacity or other 

performance-related feature which other 

products within such type (or class) do 

not have and such feature justifies a 

higher or lower standard. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(q)(1)) In 

determining whether a performancerelated feature justifies a different 

standard for a group of equipment, DOE 

must consider such factors as the utility 

to the consumer of such a feature and 

other factors DOE deems appropriate. 

(Id.) Any rule prescribing such a 

standard must include an explanation of 

the basis on which such higher or lower 

level was established. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(q)(2)) 

B. Background 

1. Current Standards 

DOE does not currently have energy 

conservation standards for ESEMs even 

though DOE has the authority to 

regulate electric motors broadly. DOE 

has adopted energy conservation 

standards for medium electric motors 

(‘‘MEMs’’) at 10 CFR 431.25 (see section 

III.A of this document for further 

description), as well as small electric 

motors (‘‘SEMs’’) at 10 CFR 431.446, 

which are separately regulated 

categories. 

2. History of Standards Rulemaking for 

ESEMs 

On May 21, 2020, DOE issued an early 

assessment request for information 

(‘‘RFI’’) (‘‘May 2020 Early Assessment 

Review RFI’’) in which DOE stated that 

it was initiating an early assessment 

review to determine whether any new or 

amended standards would satisfy the 

relevant requirements of EPCA for a 

new or amended energy conservation 

standard for electric motors and sought 

information related to that effort. 

Specifically, DOE sought data and 

information that could enable the 

agency to determine whether DOE 

should propose a ‘‘no new standard’’ 

determination because a more stringent 

standard: (1) would not result in a 

significant savings of energy; (2) is not 

technologically feasible; (3) is not 

economically justified; or (4) any 

combination of the foregoing. 85 FR 

30878, 30879. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87070 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

16 In the March 2022 Preliminary Analysis, DOE 

used the term small, non-small electric motor, 

electric motors (‘‘SNEMs’’) to designate ESEMs. 

17The parenthetical reference provides a 

reference for information located in the docket of 

DOE’s rulemaking to develop energy conservation 

standards for electric motors. (Docket No. EERE– 

2020–BT–STD–0007, which is maintained at 

www.regulations.gov). The references are arranged 

as follows: (commenter name, comment docket ID 

number, page of that document). 

On March 2, 2022, DOE published a 

Preliminary Analysis for electric motors 

(‘‘March 2022 Preliminary Analysis’’). 

87 FR 11650. In conjunction with the 

March 2022 Preliminary Analysis, DOE 

published the March 2022 Preliminary 

TSD, which presented the results of the 

in-depth technical analyses in the 

following areas: (1) engineering; (2) 

markups to determine equipment price; 

(3) energy use; (4) LCC and PBP; and (5) 

national impacts. The results presented 

included the current scope of electric 

motors regulated at 10 CFR 431.25, in 

addition to an expanded scope of 

motors, including electric motors above 

500 horsepower, air-over electric 

motors, and ESEMs.16 See chapter 2 of 

the March 2022 Preliminary TSD. DOE 

requested comment on a number of 

topics regarding the analysis presented. 

However, DOE is only responding to 

comments pertaining to ESEMs and airover expanded scope electric motors 

(‘‘AO–ESEMs’’) in this NOPR, as DOE 

responded to the rest of the comments 

pertaining to medium electric motors 

and their air-over equivalents in the 

Electric Motors Direct Final Rule 

published on June 1, 2023 (‘‘June 2023 

DFR’’) that amended energy 

conservation standards for medium 

electric motors and their air-over 

equivalents. 88 FR 36066. 

On April 5, 2022, DOE held a public 

webinar in which it presented the 

methods and analysis in the March 2022 

Preliminary Analysis and solicited 

public comment. (‘‘April 5, 2022, Public 

Meeting’’). 

TABLE II–1—MARCH 2022 PRELIMINARY ANALYSIS WRITTEN COMMENTERS

Commenter(s) Reference in 

this NOPR Docket No. Commenter type 

American Council for an Energy-Efficient Economy, Appliance Standards Awareness Project, 

National Electrical Manufacturers Association, Natural Resources Defense Council, Northwest 

Energy Efficiency Alliance, Pacific Gas & Electric Company, San Diego Gas & Electric, 

Southern California Edison.

Electric Motors Working 

Group.

38 Working Group. 

Appliance Standards Awareness Project, American Council for an Energy-Efficient Economy, 

Natural Resources Defense Council, New York State Energy Research and Development Authority.

Joint Advocates ........... 27 Efficiency Advocacy Organizations. 

Association of Home Appliance Manufacturers; Air-Conditioning, Heating, and Refrigeration Institute.AHAM and AHRI .......... 25 Trade Association. 

Air-Conditioning, Heating, and Refrigeration Institute ..................................................................... AHRI ............................ 26 Trade Association. 

Pacific Gas and Electric Company, San Diego Gas and Electric, and Southern California Edison; collectively, the California Investor-Owned Utilities.CA IOUs ....................... 30 Utilities. 

Electrical Apparatus Service Association, Inc ................................................................................. EASA ........................... 21 Trade Association. 

Hydraulics Institute ........................................................................................................................... HI ................................. 31 Trade Association. 

Lennox International ........................................................................................................................ Lennox ......................... 29 Manufacturer. 

Northwest Energy Efficiency Alliance .............................................................................................. NEEA ........................... 33 Efficiency Advocacy Organization. 

National Electrical Manufacturers Association, Association of Home Appliance Manufacturers, 

the Air-Conditioning, Heating, and Refrigeration Institute, the Medical Imaging Technology Alliance, the Outdoor Power Equipment Institute, Home Ventilating Institute, and the Power 

Tool Institute.

Joint Industry Stakeholders.23 Trade Associations. 

National Electrical Manufacturers Association ................................................................................. NEMA ........................... 22 Trade Association. 

A parenthetical reference at the end of 

a comment quotation or paraphrase 

provides the location of the item in the 

public record.17 To the extent that 

interested parties have provided written 

comments that are substantively 

consistent with any oral comments 

provided during the April 5, 2022, 

public meeting, DOE cites the written 

comments throughout this document. 

By letter dated December 22, 2022, 

DOE received the December 2022 Joint 

Recommendation from the Electric 

Motors Working Group. The December 

2022 Joint Recommendation addressed 

energy conservation standards for hightorque, medium-torque, low-torque, and 

polyphase ESEMs that are 0.25–3 hp, 

and AO–ESEMs. The December 2022 

Joint Recommendation recommended a 

compliance date for updated energy 

conservation standards for AO–ESEMs 

as well. (Electric Motors Working 

Group, No. 38 at p. 5) 

3. Electric Motors Working Group 

Recommended Standard Levels 

This section summarizes the standard 

levels recommended in the December 

2022 Joint Recommendation and the 

subsequent procedural steps taken by 

DOE. Further discussion on scope is 

provided in section III.A of this 

document. The Electric Motors Working 

Group stated that the recommended 

levels would minimize potential market 

disruptions by allowing smaller designs 

to remain on the market. Specifically 

the Electric Motors Working Group 

stated that the recommended levels for 

high and medium torque ESEM could 

allow smaller capacitor start induction 

run (‘‘CSIR’’) motors and currently 

unregulated split-phase motors, which 

are common in certain spaceconstrained products; for low torque 

ESEMs, the Electric Motors Working 

Group stated that manufacturers believe 

efficiency levels above the 

recommended levels could result in 

significant increases in the physical 

size, unavailability of product, and, in 

some cases, may be extremely difficult 

to achieve with current permanent split 

capacitor (‘‘PSC’’) technology; and for 

AO–ESEMs, the Electric Motors 

Working Group stated that the 

recommended levels represented the 

highest feasible efficiencies given the 

potential design constraints associated 

with their use in covered equipment. 

(Id. at pp. 3–5) 

Recommendation A: For high-torque 

and medium-torque ESEMs (i.e., CSIR, 

capacitor start capacitor run (‘‘CSCR’’), 

and split-phase motors), the Electric 

Motors Working Group recommended 

the following standard levels, expressed 

in average full-load efficiency: 

(1) Values for open and enclosed 

motors rated at 0.25, 0.33, and 0.5 hp 

(all pole configurations) that are largely 

based on the levels in NEMA MG 1, 

Table 12–19, ‘‘Premium Efficiency 

Levels for Capacitor-Start/InductionVerDate Sep<11>2014 18:55 Dec 14, 2023 Jkt 262001 PO 00000 Frm 00010 Fmt 4701 Sfmt 4702 E:\FR\FM\15DEP2.SGM 15DEP2

ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87071 

18 ‘‘DOE’s new efficiency level’’ refers to 

preliminary efficiency levels that were developed 

during the private negotiations of the Electric 

Motors Working Group. See Table II–3 for the final 

values chosen from those preliminary efficiency 

levels. 

19See footnote 18. 

Run Single-Phase Small Motors.’’ The 

exceptions are the open and enclosed 

0.5 hp 4-pole values, which have lower 

efficiency standards described in Table 

II–2. For cases where Table 12–19 lists 

two frame sizes (e.g., 48 and 56 frame) 

for a given hp rating, the recommended 

efficiency level reflects the smaller 

frame size (i.e., lower efficiency). 

(2) Values for open motors (2-, 4-, 6- 

pole) above 0.5 hp that are consistent 

with the current small electric motor 

standards for CSCR and CSIR motors 

found in 10 CFR part 431, subpart X 

(§ 431.446). 

(3) Values for 8-pole open motors 

above 0.5 hp and all enclosed motors 

above 0.5 hp that are based on the levels 

in NEMA MG 1, Table 12–20, ‘‘Premium 

Efficiency Levels for Capacitor-Start/ 

Capacitor-Run Single-Phase Small 

Motors.’’ For cases where Table 12–20 

lists two frame sizes (e.g., 48 and 56 

frame) for a given hp rating, the 

recommended efficiency level reflects 

the smaller frame size (i.e., lower 

efficiency). 

TABLE II–2—RECOMMENDED ENERGY CONSERVATION STANDARDS FOR HIGH-TORQUE AND MEDIUM-TORQUE ESEMS

[i.e., CSIR, CSCR, and split-phase motors] 

hp 

Average full load efficiency 

Open Enclosed 

2-pole 4-pole 6-pole 8-pole 2-pole 4-pole 6-pole 8-pole 

0.25 .................................................................. 59.5 59.5 57.5 ................ 59.5 59.5 57.5 ................

0.33 .................................................................. 64.0 64.0 62.0 50.5 64.0 64.0 62.0 50.5 

0.5 .................................................................... 68.0 69.2 68.0 52.5 68.0 67.4 68.0 52.5 

0.75 .................................................................. 76.2 81.8 80.2 72.0 75.5 75.5 75.5 72.0 

1 ....................................................................... 80.4 82.6 81.1 74.0 77.0 80.0 77.0 74.0 

1.5 .................................................................... 81.5 83.8 ................ ................ 81.5 81.5 80.0 ................

2 ....................................................................... 82.9 84.5 ................ ................ 82.5 82.5 ................ ................

3 ....................................................................... 84.1 ................ ................ ................ 84.0 ................ ................ ................

(Id. at pp. 3, 6). 

Recommendation B: For low-torque 

ESEMs (i.e., shaded pole and PSC 

motors), the Electric motors Working 

Group recommended the following 

standard levels, expressed in terms of 

average full-load efficiency: 

(1) Values for open motors rated at 

0.25 hp, 0.33 hp, and 1.5 hp and above 

that are based on DOE’s new efficiency 

level (EL 3).18

(2) Values for open motors rated at 

0.5, 0.75, and 1.0 hp that are based on 

DOE’s new EL 2, with two exceptions: 19

(a) The 6-pole, 1.0 hp value is the 

mid-point between EL 2 (75.3%) and EL 

3 (79.2%) 

(b) The 2-pole, 0.5 hp value is the 

mid-point between EL 2 (66.4%) and EL 

3 (71.1%) 

(3) Values for enclosed motors that are 

based on the equivalent open motor 

efficiency but are adjusted to account 

for the lack of additional cooling, which 

is a function of motor rpm (i.e., number 

of poles). The adjustment is 3% for 2- 

pole motors, 2% for 4-pole motors, 1% 

for 6-pole motors, and 0% for 8-pole 

motors. 

TABLE II–3—RECOMMENDED ENERGY CONSERVATION STANDARDS FOR LOW-TORQUE ESEMS

[i.e., shaded pole and PSC motors] 

hp 

Average full load efficiency 

Open Enclosed 

2-pole 4-pole 6-pole 8-pole 2-pole 4-pole 6-pole 8-pole 

0.25 .................................................................. 63.9 66.1 60.2 52.5 60.9 64.1 59.2 52.5 

0.33 .................................................................. 66.9 69.7 65.0 56.6 63.9 67.7 64.0 56.6 

0.5 .................................................................... 68.8 70.1 66.8 57.1 65.8 68.1 65.8 57.1 

0.75 .................................................................. 70.5 74.8 73.1 62.8 67.5 72.8 72.1 62.8 

1 ....................................................................... 74.3 77.1 77.3 65.7 71.3 75.1 76.3 65.7 

1.5 .................................................................... 79.9 82.1 80.5 72.2 76.9 80.1 79.5 72.2 

2 ....................................................................... 81.0 82.9 81.4 73.3 78.0 80.9 80.4 73.3 

3 ....................................................................... 82.4 84.0 82.5 74.9 79.4 82.0 81.5 74.9 

(Id. at pp. 4, 6) 

Recommendation C: For polyphase 

ESEMs (i.e., three-phase ESEMs), the 

Electric Motors Working Group 

recommended the following standard 

levels, expressed in terms of average 

full-load efficiency: 

(1) Values for 2-pole, 4-pole, and 6- 

pole open motors that are consistent 

with the current small electric motor 

standards for polyphase motors found in 

10 CFR part 431, subpart X (§ 431.446). 

(2) Values for 8-pole open and all 

enclosed motors from NEMA MG 1, 

Table 12–21, ‘‘Premium Efficiency 

Levels for Three-Phase Induction Small 

Motors.’’ For cases where Table 12–21 

lists two frame sizes (e.g., 48 and 56 

frame) for a given hp rating, the 

recommended efficiency level reflects 

the smaller frame size (i.e., lower 

efficiency). 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87072 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

20See CUAC/HP ASRAC Working group term 

sheet at: www.regulations.gov/document/EERE2022-BT-STD-0015-0087. 

TABLE II–4—RECOMMENDED ENERGY CONSERVATION STANDARDS FOR POLYPHASE ESEMS

[i.e., Three-Phase ESEMs] 

hp 

Average full load efficiency 

Open Enclosed 

2-pole 4-pole 6-pole 8-pole 2-pole 4-pole 6-pole 8-pole 

0.25 .................................................................. 65.6 69.5 67.5 62.0 66.0 68.0 66.0 62.0 

0.33 .................................................................. 69.5 73.4 71.4 64.0 70.0 72.0 70.0 64.0 

0.5 .................................................................... 73.4 78.2 75.3 66.0 72.0 75.5 72.0 66.0 

0.75 .................................................................. 76.8 81.1 81.7 70.0 75.5 77.0 74.0 70.0 

1 ....................................................................... 77.0 83.5 82.5 75.5 75.5 77.0 74.0 75.5 

1.5 .................................................................... 84.0 86.5 83.8 77.0 84.0 82.5 87.5 78.5 

2 ....................................................................... 85.5 86.5 ................ 86.5 85.5 85.5 88.5 84.0 

3 ....................................................................... 85.5 86.9 ................ 87.5 86.5 86.5 89.5 85.5 

(Id.) 

Recommendation D: The Electric 

Motors Working Group recommended 

that if standards are warranted for AO– 

ESEMs, DOE set the standards at the 

same levels as those for comparable 

ESEMs used in non-air-over 

applications. (Id. at p. 5) 

Recommendation E: The Electric 

Motors Working Group recommended 

that DOE align the compliance date for 

AO–ESEMs with the compliance date 

for updated energy conservation 

standards for Commercial Unitary Air 

Conditioners/Heat Pumps (‘‘CUAC/ 

HPs’’) currently under negotiation in 

DOE’s Appliance Standards and 

Rulemaking Federal Advisory 

Committee (‘‘ASRAC’’) Working Group 

on CUAC/HPs. The Electric Motors 

Working Group stated this 

recommended compliance date would 

appropriately balance energy savings 

and the time needed for manufacturers 

of equipment with AO–ESEMs to redesign products. (Id.) 

DOE notes that the scope and 

standards proposed in this document 

are equivalent to those recommended by 

the Electric Motors Working Group. 

Regarding the compliance year for 

energy conservation standards for 

ESEMs, the Electric Motors Working 

Group recommended that DOE align the 

compliance date for AO–ESEMs with 

the compliance date for updated energy 

conservation standards for CUAC/HP, 

which were under negotiation in DOE’s 

ASRAC Working Group on CUAC/HPs 

at the time. Since then, the CUAC/HP 

negotiations have concluded and 

include a recommended compliance 

year of 2029 (i.e., January 1, 2029).20

ESEMs are a type of electric motor, but 

not among the types of electric motor for 

which Congress established standards 

and a rulemaking schedule in 42 U.S.C. 

6313(b). As such, they are exempt from 

the requirements of 42 U.S.C. 6313(b), 

including the compliance deadlines 

provided in that section. Because 

section 42 U.S.C. 6316(a) applies certain 

requirements of 42 U.S.C. 6295(l)–(s) of 

EPCA to certain equipment, including 

electric motors, DOE considered 

whether the compliance deadlines of 42 

U.S.C. 6295(m)(4) applies to ESEMs. 42 

U.S.C. 6295(m)(4)(A) defines 

compliance deadlines for specific 

products; however, electric motors and 

ESEMs are not listed, nor does 42 U.S.C. 

6316 apply a cross reference on how to 

apply these paragraphs to electric 

motors or ESEMs. Accordingly, DOE has 

determined that these compliance 

deadlines do not apply to ESEMs. 

Additionally, DOE reviewed section 

6295(m)(4)(B), which states that a 

manufacturer shall not be required to 

apply new standards to a product with 

respect to which other new standards 

have been required in the prior 6-year 

period. As no standards for ESEMs have 

not yet been established, this paragraph 

also does not apply to ESEMs. As such, 

DOE has determined that it has 

discretion to establish compliance 

deadlines for ESEMs. Therefore, DOE 

proposes a January 1, 2029, compliance 

date in accordance with the 

recommendation from the Electric 

Motors Working Group. DOE has 

tentatively determined that this 

compliance date would provide 

sufficient lead time to motor 

manufacturers based on the 

recommendation from the Electric 

Motors Working Group, which includes 

NEMA. 

C. Deviation From Process Rule 

In accordance with section 3(a) of 10 

CFR part 430, subpart C, appendix A 

(‘‘Process Rule’’), DOE notes that it is 

deviating from the provision in the 

Process Rule regarding the pre-NOPR 

and NOPR stages for an energy 

conservation standards rulemaking. 

1. Public Comment Period 

Section 6(f)(2) of the Process Rule 

specifies that the length of the public 

comment period for a NOPR will be not 

less than 75 calendar days. For this 

NOPR, DOE has opted instead to 

provide a 60-day comment period, 

consistent with EPCA requirements. (42 

U.S.C. 6316(a); 42 U.S.C. 6295(p). DOE 

is opting to deviate from the 75-day 

comment period because stakeholders 

have already been afforded multiple 

opportunities to provide comments on 

this proposed rulemaking. As noted 

previously, DOE requested comment on 

various issues pertaining to this 

standards rulemaking in the May 2020 

Early Assessment Review RFI and 

provided stakeholders with a 30-day 

comment period. 85 FR 30878. 

Additionally, DOE provided a 60-day 

comment period for stakeholders to 

provide input on the analyses presented 

in the March 2022 Preliminary Analysis. 

87 FR 11650. The analytical 

assumptions and approaches used for 

the analyses conducted for this NOPR 

are similar to those used for the 

preliminary analysis. Furthermore, as 

discussed previously in this document, 

the standards proposed in this 

document are equivalent to those 

recommended by the Electric Motors 

Working Group for the electric motor 

types subject to this proposal. Therefore, 

DOE believes a 60-day comment period 

is appropriate and will provide 

interested parties with a meaningful 

opportunity to comment on the 

proposed rule. 

2. Framework Document 

Section 6(a)(2) of the Process Rule 

states that if DOE determines it is 

appropriate to proceed with a 

rulemaking, the preliminary stages of a 

rulemaking to issue or amend an energy 

conservation standard that DOE will 

undertake will be a framework 

document and preliminary analysis, or 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87073 

21The March 2022 Preliminary TSD is available 

at www.regulations.gov/document/EERE-2020-BTSTD-0007-0010. 

22 DOE uses the term ‘‘expanded scope electric 

motor’’ or ‘‘ESEM’’ (formally known as ‘‘small, nonsmall electric motor, electric motors’’ or ‘‘SNEMs’’), 

to describe those small electric motors that are not 

included in the definition ‘‘small electric motor’’ 

under EPCA, but otherwise fall within the 

definition of ‘‘electric motor’’ under EPCA. The 

term ‘‘small electric motor’’ means a NEMA general 

purpose alternating current single-speed induction 

motor, built in a two-digit frame number series in 

accordance with NEMA Standards Publication 

MG1–1987. (42 U.S.C. 6311(13)(G)). 

23 DOE added the ‘‘E’’ and ‘‘Y’’ designations for 

IEC Design motors into 10 CFR 431.25(g) in the 

electric motors test procedure final rule. 87 FR 

63588, 63596–636597, 63606 (Oct. 19, 2022). 

an advance notice of proposed 

rulemaking. While DOE published a 

preliminary analysis for this rulemaking 

(see 87 FR 11650), DOE did not publish 

a framework document in conjunction 

with the preliminary analysis. DOE 

notes, however, that chapter 2 of the 

March 2022 Preliminary TSD that 

accompanied the March 2022 

Preliminary Analysis—entitled 

Analytical Framework, Comments from 

Interested Parties, and DOE 

Responses—describes the general 

analytical framework that DOE uses in 

evaluating and developing potential 

new energy conservation standards.21

As such, publication of a separate 

framework document would be largely 

redundant of chapter 2 of the March 

2022 Preliminary TSD. 

III. General Discussion 

DOE developed this proposal after 

considering oral and written comments, 

data, and information from interested 

parties that represent a variety of 

interests, including the December 2022 

Joint Recommendation. The following 

discussion addresses issues raised by 

these commenters. 

A. Scope of Coverage and Equipment 

Classes 

1. General Scope of Coverage and 

Equipment Classes 

This document covers certain 

equipment meeting the definition of 

electric motors as defined in 10 CFR 

431.12. Specifically, the definition for 

‘‘electric motor’’ is ‘‘a machine that 

converts electrical power into rotational 

mechanical power.’’ 10 CFR 431.12. 

This NOPR addresses ESEMs, which are 

covered under 10 CFR part 431 subpart 

B. This NOPR does not address small 

electric motors, which are covered 

under 10 CFR part 431 subpart X.22

Currently, DOE regulates MEMs 

falling into the NEMA Design A, NEMA 

Design B, NEMA Design C, and fire 

pump motor categories and those 

electric motors that meet the criteria 

specified at 10 CFR 431.25(g). 10 CFR 

431.25(h)–(j). Section 431.25(g) specifies 

that the relevant standards apply only to 

electric motors, including partial 

electric motors, that satisfy the 

following criteria: 

(1) Are single-speed, induction 

motors; 

(2) Are rated for continuous duty (MG 

1) operation or for duty type S1 (IEC); 

(3) Contain a squirrel-cage (MG 1) or 

cage (IEC) rotor; 

(4) Operate on polyphase alternating 

current 60-hertz sinusoidal line power; 

(5) Are rated 600 volts or less; 

(6) Have a 2-, 4-, 6-, or 8-pole 

configuration; 

(7) Are built in a three-digit or fourdigit NEMA frame size (or IEC metric 

equivalent), including those designs 

between two consecutive NEMA frame 

sizes (or IEC metric equivalent), or an 

enclosed 56 NEMA frame size (or IEC 

metric equivalent); 

(8) Produce at least one horsepower 

(0.746 kW) but not greater than 500 

horsepower (373 kW), and 

(9) Meet all of the performance 

requirements of one of the following 

motor types: A NEMA Design A, B, or 

C motor or an IEC Design N, NE, NEY, 

NY or H, HE, HEY, HYmotor.23

10 CFR 431.25(g). 

The definitions for ‘‘NEMA Design A 

motors,’’ ‘‘NEMA Design B motors,’’ 

‘‘NEMA Design C motors,’’ ‘‘fire pump 

electric motors,’’ ‘‘IEC Design N motor,’’ 

and ‘‘IEC Design H motor,’’ as well as 

‘‘E’’ and ‘‘Y’’ designated IEC Design 

motors, are codified in 10 CFR 431.12. 

DOE has also currently exempted 

certain categories of motors from 

standards. The exemptions are as 

follows: 

(1) Air-over electric motors; 

(2) Component sets of an electric 

motor; 

(3) Liquid-cooled electric motors; 

(4) Submersible electric motors; and 

(5) Inverter-only electric motors. 

10 CFR 431.25(l). 

On October 19, 2022, DOE published 

the electric motors test procedure final 

rule (‘‘October 2022 Final Rule’’). 87 FR 

63588. As part of the October 2022 Final 

Rule, DOE expanded the test procedure 

scope to additional categories of electric 

motors that currently do not have 

energy conservation standards. 87 FR 

63588, 63593–63606. The expanded test 

procedure scope included the following: 

(1) Electric motors having a rated 

horsepower above 500 and up to 750 hp 

that meets the criteria listed at 

§ 431.25(g), with the exception of 

criteria § 431.25(g)(8) to air-over electric 

motors (‘‘AO–MEMs’’), and inverteronly electric motors; 

(2) Expanded Scope Electric Motors 

(‘‘ESEM’’, formally known as ‘‘small, 

non-small electric motor, electric 

motors’’ or ‘‘SNEMs’’), that are not airover electric motors, which: 

(a) Are not a small electric motor, as 

defined at § 431.442 and is not a 

dedicated pool pump motors as defined 

at § 431.483; 

(b) Are rated for continuous duty (MG 

1) operation or for duty type S1 (IEC); 

(c) Operate on polyphase or singlephase alternating current 60-hertz (Hz) 

sinusoidal line power; or is used with 

an inverter that operates on polyphase 

or single-phase alternating current 60- 

hertz (Hz) sinusoidal line power; 

(d) Are rated for 600 volts or less; 

(e) Are a single-speed induction motor 

capable of operating without an inverter 

or is an inverter-only electric motor; 

(f) Produce a rated motor horsepower 

greater than or equal to 0.25 horsepower 

(0.18 kW); and 

(g) Are built in the following frame 

sizes: any two-, or three-digit NEMA 

frame size (or IEC equivalent) if the 

motor operates on single-phase power; 

any two-, or three-digit NEMA frame 

size (or IEC equivalent) if the motor 

operates on polyphase power, and has a 

rated motor horsepower less than 1 

horsepower (0.75 kW); or a two-digit 

NEMA frame size (or IEC metric 

equivalent), if the motor operates on 

polyphase power, has a rated motor 

horsepower equal to or greater than 1 

horsepower (0.75 kW), and is not an 

enclosed 56 NEMA frame size (or IEC 

metric equivalent). 

(3) ESEMs that are air-over electric 

motors (‘‘AO–ESEMs’’) and inverteronly electric motors; 

(4) A synchronous electric motor, 

which: 

(a) Is not a dedicated pool pump 

motor as defined at § 431.483 or is not 

an air-over electric motor; 

(b) Is a synchronous electric motor; 

(c) Is rated for continuous duty (MG 

1) operation or for duty type S1 (IEC); 

(d) Operates on polyphase or singlephase alternating current 60-hertz (Hz) 

sinusoidal line power; or is used with 

an inverter that operates on polyphase 

or single-phase alternating current 60- 

hertz (Hz) sinusoidal line power; 

(e) Is rated 600 volts or less; and 

(f) Produces at least 0.25 hp (0.18 kW) 

but not greater than 750 hp (559 kW). 

(5) Synchronous electric motors that 

are inverter-only electric motors. 

See section 1.2, appendix B. 

In the October 2022 Final Rule, DOE 

noted that, for these motors newly 

included within the scope of the test 

procedure for which there was no 

established energy conservation 

standards, such as ESEMs and AO– 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87074 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

24However, manufacturers making voluntary 

representations respecting the energy consumption 

or cost of energy consumed by such motors are 

required to use the DOE test procedure for making 

such representations beginning 180 days following 

publication of the October 2022 Final Rule. Id. at 

87 FR 63591. 

ESEMs, manufacturers would not be 

required to use the test procedure to 

certify these motors to DOE until such 

time as a standard is established. 87 FR 

63588, 63591.24 Further, the October 

2022 Final Rule continued to exclude 

the following categories of electric 

motors: 

(1) Inverter-only electric motors that 

are air-over electric motors; 

(2) Component sets of an electric 

motor; 

(3) Liquid-cooled electric motors; and 

(4) Submersible electric motors. 

Due to the number of electric motor 

characteristics (e.g., horsepower rating, 

pole configuration, and enclosure), in 

the March 2022 Preliminary Analysis, 

DOE used two constructs to help 

develop appropriate energy 

conservation standards for electric 

motors: ‘‘equipment class’’ and 

‘‘equipment class groups.’’ An 

equipment class represents a unique 

combination of motor characteristics for 

which DOE is establishing a specific 

energy conservation standard. This 

includes permutations of electric motor 

design topologies (i.e., CSIR/CSCR, split 

phase, shaded pole, PSC, or polyphase), 

standard horsepower ratings (i.e., 

standard ratings from 0.25 to 3 

horsepower varying based on torque 

level and pole count), pole 

configurations (i.e., 2-, 4-, 6-, or 8-pole), 

and enclosure types (i.e., open or 

enclosed). An ECG is a collection of 

electric motors that share a common 

design trait. Equipment class groups 

include motors over a range of 

horsepower ratings, enclosure types, 

and pole configurations. Essentially, 

each equipment class group is a 

collection of a large number of 

equipment classes with the same design 

trait. As such, in the March 2022 

Preliminary Analysis, DOE presented 

equipment class groups based on 

electric motor topology, horsepower 

rating, pole configuration. and enclosure 

type. See sections 2.3.1 and 3.2.2 of the 

March 2022 Preliminary TSD. 

In the March 2022 Preliminary 

Analysis, DOE analyzed the additional 

motors now included within the scope 

of the test procedure after the October 

2022 Final Rule. See sections 2.2.1 and 

2.2.3.2 of the March 2022 Preliminary 

TSD. This analysis included MEMs from 

1–500hp, AO–MEMs, and ESEMs 

(including AO–ESEMs). This NOPR 

proposes new standards for only a 

portion of the scope analyzed in the 

March 2022 Preliminary Analysis and 

included within the scope of the test 

procedure after the October 2022 Final 

Rule. Specifically, in this NOPR, DOE is 

only proposing standards for ESEMs, 

including AO–ESEMs. As further 

described in section IV.A.3 of this 

document, DOE used multiple 

performance characteristics to establish 

the equipment classes used in this 

NOPR. Among these performance 

characteristics are locked-rotor torque 

and number of phases of the input 

power of a motor, used to create the 

following groups: high and medium 

torque single-phase ESEMs (i.e., CSIR/ 

CSCR and split phase), low torque 

single phase ESEMs (i.e., shaded pole, 

PSC) and polyphase ESEMs that meet 

the criteria a) through g) as listed 

previously (See section 1.2, 10 CFR part 

431, appendix B). These are typically 

used in residential as well as 

commercial and industrial applications. 

Further discussion on equipment 

classes and the basis used to establish 

them is provided in section IV.A.3 of 

this document. 

2. Structure of the Regulatory Text 

In addition to proposing new 

requirements for ESEMs, in this NOPR, 

DOE proposes to move portions of the 

existing electric motor regulations that 

pertain to the energy conservation 

standards and their compliance dates (at 

10 CFR 431.25) to improve clarity. In 

this NOPR, DOE proposes to revise 10 

CFR 431.25 by retaining the existing 

electric motor energy conservation 

standards and their compliance dates, 

adding provisions pertaining to ESEMs, 

and reorganizing all provisions 

currently in 10 CFR 431.25 by 

compliance date (i.e., each section has a 

different compliance date) to improve 

clarity. See Table III–1 for details. 

TABLE III–1—REVISIONS TO 10 CFR 431.25 

Current location Content high-level description Proposed revised location Impact 

§ 431.25(a)–(f) .................. Describes standards for certain electric motors manufactured on or 

after December 19, 2010, but before June 1, 2016.

None .................................................. None—Removed as these requirements are no longer current. 

§ 431.25(k), § 431.25(q) ... Describes how to establish the 

horsepower for purposes of determining the required minimum 

nominal full-load efficiency of an 

electric motor.

§ 431.25(a) ......................................... Avoids repeating identical provisions 

in each subsection. 

§ 431.25(g) ....................... Describes the criteria for inclusion for 

certain electric motors manufactured on or after June 1, 2016, but 

before June 1, 2027 subject to energy conservation standards.

§ 431.25(b)(1)(i) ................................. Moves the ‘‘inclusion’’ criteria, so 

that the proper scope is presented 

fully upfront in each section. 

§ 431.25(h) ....................... Describes standards for certain 

NEMA Design A and B electric 

motors (and IEC equivalent) manufactured on or after June 1, 2016, 

but before June 1, 2027.

§ 431.25(b)(2)(i) ................................. Makes each section ‘‘comprehensive’’ by carrying over the existing 

standards for all electric motors 

categories in each section. 

§ 431.25(i) ........................ Describes standards for certain 

NEMA Design C electric motors 

(and IEC equivalent) manufactured 

on or after June 1, 2016.

§ 431.25(b)(2)(ii), § 431.25(c)(2)(iv), 

§ 431.25(d)(3)(iv).

Makes each section ‘‘comprehensive’’ by carrying over the existing 

standards for all electric motors 

categories in each section. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87075 

TABLE III–1—REVISIONS TO 10 CFR 431.25—Continued 

Current location Content high-level description Proposed revised location Impact 

§ 431.25(j) ........................ Describes standards for certain fire 

pump electric motors (and IEC 

equivalent) manufactured on or 

after June 1, 2016.

§ 431.25(b)(2)(iii), § 431.25(c)(2)(v), 

§ 431.25(d)(3)(v).

Makes each section ‘‘comprehensive’’ by carrying over the existing 

standards for all electric motors 

categories in each section. 

§ 431.25(l) ........................ Describes the criteria for exclusion 

for certain electric motors manufactured on or after June 1, 2016, 

but before June 1, 2027 subject to 

energy conservation standards.

§ 431.25(b)(1)(ii) ................................ Moves the ‘‘exemptions’’ to directly 

after the ‘‘inclusion’’ criteria, so 

that the proper scope is presented 

fully upfront in each section, prior 

to presenting the sub-group criteria 

and standards. 

§ 431.25(m) ...................... Describes the criteria for inclusion for 

certain electric motors manufactured on or after June 1, 2027 

subject to energy conservation 

standards.

§ 431.25(c)(1)(i) ................................. Moves the ‘‘inclusion’’ criteria, so 

that the proper scope is presented 

fully upfront in each section. 

§ 431.25(n) ....................... Describes standards for certain 

NEMA Design A and B electric 

motors (and IEC equivalent),but 

excluding fire pump electric motors 

and air-over electric motors manufactured on or after June 1, 2027.

§ 431.25(c)(2)(i), § 431.25(d)(3)(i) ..... Makes each section ‘‘comprehensive’’ by carrying over the existing 

standards for all electric motors 

categories in each section. 

§ 431.25(o) ....................... Describes standards for certain airover NEMA Design A and B electric motors (and IEC equivalent), 

built in standard frame size manufactured on or after June 1, 2027.

§ 431.25(c)(2)(ii), § 431.25(d)(3)(ii) .... Makes each section ‘‘comprehensive’’ by carrying over the existing 

standards for all electric motors 

categories in each section. 

§ 431.25(p) ....................... Describes standards for certain airover NEMA Design A and B electric motors (and IEC equivalent), 

built in specialized frame size 

manufactured on or after June 1, 

2027.

§ 431.25(c)(2)(iii), § 431.25(d)(3)(iii) .. Makes each section ‘‘comprehensive’’ by carrying over the existing 

standards for all electric motors 

categories in each section. 

§ 431.25(r) ........................ Describes the criteria for exclusion 

for certain electric motors manufactured on or after June 1, 2027, 

subject to energy conservation 

standards.

§ 431.25(c)(1)(ii) ................................ Moves the ‘‘exemptions’’ to directly 

after the ‘‘inclusion’’ criteria, so 

that the proper scope is presented 

fully upfront in each section, prior 

to presenting the sub-group criteria 

and standards. 

New section ..................... Describes the criteria for inclusion as 

ESEM.

§ 431.25(d)(2)(i) ................................. New section—Adds the ESEM provisions proposed in this NOPR. 

New section ..................... Describes the criteria for exclusion 

for certain ESEM electric motors 

manufactured on or after January 

1, 2029.

§ 431.25(d)(2)(ii) ................................ New section—Adds the ESEM provisions proposed in this NOPR. 

New section ..................... Describes standards for certain high 

and medium torque ESEM manufactured on or after January 1, 

2029.

§ 431.25(d)(3)(vi) ............................... New section—Adds the ESEM provisions proposed in this NOPR. 

New section ..................... Describes standards for certain low 

torque ESEMs manufactured on or 

after January 1, 2029.

§ 431.25(d)(3)(vii) .............................. New section—Adds the ESEM provisions proposed in this NOPR. 

New section ..................... Describes standards for certain polyphase ESEMs manufactured on or 

after January 1, 2029.

§ 431.25(d)(3)(viii) .............................. New section—Adds the ESEM provisions proposed in this NOPR. 

3. Air-Over Medium Electric Motors and 

Air-Over ESEMs 

The June 2023 DFR amended the 

existing energy conservation standards 

for electric motors by establishing 

higher standards for certain horsepower 

electric motors and expanding the scope 

of the energy conservation standards to 

include certain air-over electric motors 

and electric motors with horsepower 

greater than 500. DOE adopted 

standards that were consistent with a 

joint recommendation that was 

submitted to DOE on November 15, 

2022 (the ‘‘November 2022 Joint 

Recommendation’’), after determining 

that the new and amended energy 

conservation standards for these 

products would result in significant 

conservation of energy and are 

technologically feasible and 

economically justified. 88 FR 36066, 

36067–36069. 

In the June 2023 DFR, DOE described 

that DOE currently regulates MEMs 

falling into the NEMA Design A, NEMA 

Design B, NEMA Design C, and fire 

pump motor categories and those 

electric motors that meet the criteria 

specified at 10 CFR 431.25(g). See id. at 

88 FR 36079–36080; 10 CFR 431.25(h)– 

(j). Specifically, DOE noted the nine 

criteria used to describe currently 

regulated MEMs, including the criteria 

at 10 CFR 431.25(g)(7), which specifies 

MEMs: ‘‘Are built in a three-digit or 

four-digit NEMA frame size (or IEC 

metric equivalent), including those 

designs between two consecutive NEMA 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87076 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

frame sizes (or IEC metric equivalent), 

or an enclosed 56 NEMA frame size (or 

IEC metric equivalent)’’. 88 FR 36066, 

36080. 

In the June 2023 DFR, to support the 

new energy conservations standards for 

air-over electric motors, DOE created 

new equipment classes: one for standard 

frame size air-over motors (‘‘AO–MEM 

(Standard frame size)’’)) and one for 

specialized frame size air-over electric 

motors (‘‘AO-Polyphase (Specialized 

frame size)’’). Id. at 88 FR 36088. DOE 

also established a definition for 

‘‘specialized frame size,’’ based on a 

table that specified the maximum 

NEMA frame diameter (or size) for a 

given motor horsepower, pole 

configuration, and enclosure 

combination. Id. This table was part of 

the November 2022 Joint 

Recommendation. Id. In this table, the 

maximum frame diameter specified 

ranges from a 48 NEMA frame motor 

diameter up to a 210 NEMA frame 

diameter, therefore including 

intermediate sizes such as 56 NEMA 

frame size in enclosed and open 

enclosure configurations. Id. 

To clarify that AO-Polyphase 

(Specialized frame size) are not 

included in the scope of electric motors 

included as ESEMs, DOE proposes to 

add ‘‘and do not have an air-over 

enclosure and a specialized frame size 

if the motor operates on polyphase 

power’’ to the ESEM scope criteria in 

the proposed paragraph (d)(2)(i)(1) of 10 

CFR 431.25 in this NOPR. DOE notes 

that AO–MEM (Standard frame size) do 

not meet the frame criteria for ESEMs 

and are not included in the scope of 

ESEMs. 

In the June 2023 DFR, DOE further 

noted that the specialized frame size airover electric motors equipment class 

included frame sizes beyond those 

described at 10 CFR 431.25(g)(7). Id. To 

better characterize this distinction in 

frame sizes, DOE stated that it was 

renaming ‘‘Specialized Frame Size AO– 

MEMs’’ (from the November 2022 Joint 

Recommendation) to ‘‘AO–Polyphase 

(Specialized frame size).’’ Id. DOE 

added that only the naming convention 

was changed compared to the November 

2022 Joint Recommendation; and the 

scope of motors being represented in 

that equipment class continued to stay 

the same as in the November 2022 Joint 

Recommendation. Id. 

The general scope description in 10 

CFR 431.25(m) of the regulatory text 

published in the June 2023 DFR 

presents the nine criteria that determine 

what electric motors the standards in 10 

CFR 431.25 apply to. Specifically, the 

criteria at 10 CFR 431.25(m)(7) specifies 

that the standards apply to electric 

motors that: ‘‘Are built in a three-digit 

or four-digit NEMA frame size (or IEC 

metric equivalent), including those 

designs between two consecutive NEMA 

frame sizes (or IEC metric equivalent), 

or an enclosed 56 NEMA frame size (or 

IEC metric equivalent).’’ 

When describing the energy 

conversation standards adopted for 

specialized frame sizes air-over electric 

motors, DOE specified that the 

standards are applicable to ‘‘air-over 

electric motor meeting the criteria in 

paragraph (m) of this section and [. . .] 

built in a specialized frame size’’ in 

section 10 CFR 431.25(p) of the 

regulatory text published in the June 

2023 DFR. 88 FR 36066, 36150. 

As published, the general scope 

description in 10 CFR 431.25(m)(7) of 

the regulatory text in the June 2023 

DFR, and the scope description in 

section 10 CFR 431.25(p) may be 

interpreted as inconsistent with the 

scope of electric motors included in the 

AO–Polyphase (Specialized frame size) 

equipment class analyzed in the June 

2023 DFR, and for which DOE intended 

to establish new standards in 10 CFR 

431.25(p). Specifically, DOE identified 

that the criteria at 10 CFR 431.25 (m)(7), 

which is identical to the criteria 

currently at 10 CFR 431.25(g)(7), 

excludes specialized frame air-over 

motors built in two-digit NEMA frame 

sizes (other than enclosed 56 frame size 

motors). Therefore, while in the 

preamble, DOE explicitly stated that the 

specialized frame size air-over electric 

motors equipment class included frame 

sizes beyond those described at 10 CFR 

431.25(g)(7), the regulatory text as 

written may be interpreted as limiting 

the covered frame sizes to those 

specifically described at 10 CFR 

431.25(g)(7). 

Therefore, to clarify the intent of the 

preamble of the June 2023 DFR when 

establishing standards for the AOpolyphase (Specialized frame size) 

equipment class, which was to include 

frame sizes beyond those described at 

10 CFR 431.25(g)(7), DOE proposes to 

make the following clarification by 

adding ‘‘or have an air-over enclosure 

and a specialized frame size’’ to the 

criteria originally included under 10 

CFR 431.25 (m)(7) in the June 2023 DFR, 

to read as follows: ‘‘Are built in a threedigit or four-digit NEMA frame size (or 

IEC metric equivalent), including those 

designs between two consecutive NEMA 

frame sizes (or IEC metric equivalent), 

or an enclosed 56 NEMA frame size (or 

IEC metric equivalent), or have an airover enclosure and a specialized frame 

size’’. As previously discussed, DOE 

proposes to re-organize the regulatory 

text at 10 CFR 431.25 and therefore is 

adding this proposed clarification in the 

new paragraphs (c)(1)(i)(7) and 

(d)(1)(i)(7). 

B. Test Procedure 

EPCA sets forth generally applicable 

criteria and procedures for DOE’s 

adoption and amendment of test 

procedures. (42 U.S.C. 6314(a)) 

Manufacturers of covered equipment 

must use these test procedures to certify 

to DOE that their equipment complies 

with energy conservation standards and 

to quantify the efficiency of their 

equipment. On October 19, 2022, DOE 

published the October 2022 Final Rule. 

87 FR 63588. As described previously in 

this document, the October 2022 Final 

Rule expanded the types of motors 

included within the scope of the test 

procedure, including the new class of 

ESEMs for which DOE is establishing 

energy conservation standards in this 

NOPR. DOE’s test procedures for 

electric motors are currently prescribed 

at appendix B as ‘‘small, non-smallelectric-motor electric motor’’ and 

measure the full-load efficiency of an 

electric motor. To harmonize 

terminology, in this NOPR, DOE is 

replacing any reference to small, nonsmall-electric-motor electric motor 

(‘‘SNEM’’) in appendix B with the term 

‘‘expanded scope electric motor,’’ or 

‘‘ESEM.’’ 

C. Represented Values 

DOE’s energy conservation standards 

for electric motors are currently 

prescribed at 10 CFR 431.25. DOE’s 

current energy conservation standards 

for electric motors are expressed in 

terms of nominal full-load efficiency 

and manufacturers must certify the 

represented value of nominal full-load 

efficiency of each basic model. 10 CFR 

429.64. The provisions establishing how 

to determine the average full-load 

efficiency and the nominal full-load 

efficiency of a basic model are provided 

at 10 CFR 429.64. 

As discussed in section II.B.3 of this 

document, the ESEM standard levels 

recommended by the Electric Motors 

Working Group are expressed in average 

full-load efficiency and not in terms of 

nominal full-load efficiency. To align 

with the Electric Motors Working Group 

recommendations, DOE proposes to 

revise the provisions related to the 

determination of the represented values 

for ESEMs at 10 CFR 429.64 such that 

manufacturers of ESEMs would certify a 

represented value of average full-load 

efficiency instead of a represented value 

of nominal full-load efficiency. DOE 

also proposes edits to 10 CFR 429.70(j) 

to reflect the use of a represented value 

of average full-load efficiency instead of 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87077 

25Each TSL is composed of specific efficiency 

levels for each product class. The TSLs considered 

for this NOPR are described in section V.A of this 

document. DOE conducted a sensitivity analysis 

that considers impacts for products shipped in a 9- 

year period. 

26The FFC metric is discussed in DOE’s 

statement of policy and notice of policy 

amendment. 76 FR 51282 (Aug. 18, 2011), as 

amended at 77 FR 49701 (Aug. 17, 2012). 

27The numeric threshold for determining the 

significance of energy savings established in a final 

rule published on February 14, 2020 (85 FR 8626, 

8670) was subsequently eliminated in a final rule 

published on December 13, 2021 (86 FR 70892). 

a represented value of nominal full-load 

efficiency for ESEMs. 

DOE requests comments on the 

proposal to use a represented value of 

average full-load efficiency for ESEMs 

and proposed revisions to 10 CFR 

429.64 and 429.70(j). 

D. Technological Feasibility 

1. General 

In each energy conservation standards 

rulemaking, DOE conducts a screening 

analysis based on information gathered 

on all current technology options and 

prototype designs that could improve 

the efficiency of the products or 

equipment that are the subject of this 

proposed rulemaking. As the first step 

in such an analysis, DOE develops a list 

of technology options for consideration 

in consultation with manufacturers, 

design engineers, and other interested 

parties. DOE then determines which of 

those means for improving efficiency 

are technologically feasible. DOE 

considers technologies incorporated in 

commercially-available products or in 

working prototypes to be 

technologically feasible. 10 CFR 431.4; 

sections 6(c)(3)(i) and 7(b)(1), Process 

Rule. 

After DOE has determined that 

particular technology options are 

technologically feasible, it further 

evaluates each technology option in 

light of the following additional 

screening criteria: (1) practicability to 

manufacture, install, and service; (2) 

adverse impacts on product utility or 

availability; (3) adverse impacts on 

health or safety, and (4) unique-pathway 

proprietary technologies. 10 CFR 431.4; 

sections 6(b)(3)(ii)–(v) and 7(b)(2)–(5), 

Process Rule. Section IV.B of this 

document discusses the results of the 

screening analysis for ESEMs, 

particularly the designs DOE 

considered, those it screened out, and 

those that are the basis for the standards 

considered in this rulemaking. For 

further details on the screening analysis 

for this proposed rulemaking, see 

chapter 4 of the NOPR TSD. 

2. Maximum Technologically Feasible 

Levels 

When DOE proposes to adopt a new 

or amended standard for a type or class 

of covered product, it must determine 

the maximum improvement in energy 

efficiency or maximum reduction in 

energy use that is technologically 

feasible for such product. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(p)(1)) 

Accordingly, in the engineering 

analysis, DOE determined the maximum 

technologically feasible (‘‘max-tech’’) 

improvements in energy efficiency for 

ESEMs, using the design parameters for 

the most efficient products available on 

the market or in working prototypes. 

The max-tech levels that DOE 

determined for this proposed 

rulemaking are described in section IV.C 

of this proposed rule and in chapter 5 

of the NOPR TSD. 

E. Energy Savings 

1. Determination of Savings 

For each TSL, DOE projected energy 

savings from application of the TSL to 

ESEMs purchased in the 30-year period 

that begins in the year of compliance 

with the proposed standards (2029– 

2058).25 The savings are measured over 

the entire lifetime of ESEMs purchased 

in the previous 30-year period. DOE 

quantified the energy savings 

attributable to each TSL as the 

difference in energy consumption 

between each standards case and the nonew-standards case. The no-newstandards case represents a projection of 

energy consumption that reflects how 

the market for a product would likely 

evolve in the absence of new energy 

conservation standards. 

DOE used its national impact analysis 

(‘‘NIA’’) spreadsheet model to estimate 

national energy savings (‘‘NES’’) from 

potential new standards for ESEMs. The 

NIA spreadsheet model (described in 

section IV.H of this document) 

calculates energy savings in terms of site 

energy, which is the energy directly 

consumed by products at the locations 

where they are used. For electricity, 

DOE reports national energy savings in 

terms of primary energy savings, which 

is the savings in the energy that is used 

to generate and transmit the site 

electricity. DOE also calculates NES in 

terms of FFC energy savings. The FFC 

metric includes the energy consumed in 

extracting, processing, and transporting 

primary fuels (i.e., coal, natural gas, 

petroleum fuels), and thus presents a 

more complete picture of the impacts of 

energy conservation standards.26 DOE’s 

approach is based on the calculation of 

an FFC multiplier for each of the energy 

types used by covered products or 

equipment. For more information on 

FFC energy savings, see section IV.H of 

this document. 

2. Significance of Savings 

To adopt any new or amended 

standards for a covered product, DOE 

must determine that such action would 

result in significant energy savings. (42 

U.S.C. 6316(a); 42 U.S.C. 6295(o)(3)(B)) 

The significance of energy savings 

offered by a new or amended energy 

conservation standard cannot be 

determined without knowledge of the 

specific circumstances surrounding a 

given proposed rulemaking.27 For 

example, some covered products and 

equipment have most of their energy 

consumption occur during periods of 

peak energy demand. The impacts of 

these products on the energy 

infrastructure can be more pronounced 

than products with relatively constant 

demand. Accordingly, DOE evaluates 

the significance of energy savings on a 

case-by-case basis, taking into account 

the significance of cumulative FFC 

national energy savings, the cumulative 

FFC emissions reductions, and the need 

to confront the global climate crisis, 

among other factors. 

As stated, the standard levels 

proposed in this NOPR are projected to 

result in national energy savings of 8.9 

quad FFC, the equivalent of the primary 

annual energy use of 95.7 million 

homes. Based on the amount of FFC 

savings, the corresponding reduction in 

emissions, and need to confront the 

global climate crisis, DOE has 

tentatively determined the energy 

savings from the standard levels 

proposed in this NOPR are ‘‘significant’’ 

within the meaning of 42 U.S.C. 6316(a) 

and 42 U.S.C. 6295(o)(3)(B). 

F. Economic Justification 

1. Specific Criteria 

As noted previously, EPCA provides 

seven factors to be evaluated in 

determining whether a potential energy 

conservation standard is economically 

justified. (42 U.S.C. 6316(a); 42 U.S.C. 

6295(o)(2)(B)(i)(I)–(VII)) The following 

sections discuss how DOE has 

addressed each of those seven factors in 

this proposed rulemaking. 

a. Economic Impact on Manufacturers 

and Consumers 

In determining the impacts of a 

potential new or amended standard on 

manufacturers, DOE conducts an MIA, 

as discussed in section IV.J of this 

document. DOE first uses an annual 

cash-flow approach to determine the 

quantitative impacts. This step includes 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87078 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

both a short-term assessment—based on 

the cost and capital requirements during 

the period between when a regulation is 

issued and when entities must comply 

with the regulation—and a long-term 

assessment over a 30-year period. The 

industry-wide impacts analyzed include 

(1) INPV, which values the industry on 

the basis of expected future cash flows, 

(2) cash flows by year, (3) changes in 

revenue and income, and (4) other 

measures of impact, as appropriate. 

Second, DOE analyzes and reports the 

impacts on different types of 

manufacturers, including impacts on 

small manufacturers. Third, DOE 

considers the impact of standards on 

domestic manufacturer employment and 

manufacturing capacity, as well as the 

potential for standards to result in plant 

closures and loss of capital investment. 

Finally, DOE takes into account 

cumulative impacts of various DOE 

regulations and other regulatory 

requirements on manufacturers. 

For individual consumers, measures 

of economic impact include the changes 

in LCC and PBP associated with new or 

amended standards. These measures are 

discussed further in the following 

section. For consumers in the aggregate, 

DOE also calculates the national net 

present value of the consumer costs and 

benefits expected to result from 

particular standards. DOE also evaluates 

the impacts of potential standards on 

identifiable subgroups of consumers 

that may be affected disproportionately 

by a standard. 

b. Savings in Operating Costs Compared 

to Increase in Price (LCC and PBP) 

EPCA requires DOE to consider the 

savings in operating costs throughout 

the estimated average life of the covered 

product in the type (or class) compared 

to any increase in the price of, or in the 

initial charges for, or maintenance 

expenses of, the covered product that 

are likely to result from a standard. (42 

U.S.C. 6316(a); 42 U.S.C. 

6295(o)(2)(B)(i)(II)) DOE conducts this 

comparison in its LCC and PBP analysis. 

The LCC is the sum of the purchase 

price of equipment (including its 

installation) and the operating expense 

(including energy, maintenance, and 

repair expenditures) discounted over 

the lifetime of the equipment. The LCC 

analysis requires a variety of inputs, 

such as equipment prices, equipment 

energy consumption, energy prices, 

maintenance and repair costs, 

equipment lifetime, and discount rates 

appropriate for consumers. To account 

for uncertainty and variability in 

specific inputs, such as equipment 

lifetime and discount rate, DOE uses a 

distribution of values, with probabilities 

attached to each value. 

The PBP is the estimated amount of 

time (in years) it takes consumers to 

recover the increased purchase cost 

(including installation) of a moreefficient equipment through lower 

operating costs. DOE calculates the PBP 

by dividing the change in purchase cost 

due to a more-stringent standard by the 

change in annual operating cost for the 

year that standards are assumed to take 

effect. 

For its LCC and PBP analysis, DOE 

assumes that consumers will purchase 

the covered equipment in the first year 

of compliance with new standards. The 

LCC savings for the considered 

efficiency levels are calculated relative 

to the case that reflects projected market 

trends in the absence of new standards. 

DOE’s LCC and PBP analysis is 

discussed in further detail in section 

IV.F of this document. 

c. Energy Savings 

Although significant conservation of 

energy is a separate statutory 

requirement for adopting an energy 

conservation standard, EPCA requires 

DOE, in determining the economic 

justification of a standard, to consider 

the total projected energy savings that 

are expected to result directly from the 

standard. (42 U.S.C. 6316(a); 42 U.S.C. 

6295(o)(2)(B)(i)(III)) As discussed in 

section IV.H of this document, DOE uses 

the NIA spreadsheet models to project 

national energy savings. 

d. Lessening of Utility or Performance of 

Products 

In establishing product classes and in 

evaluating design options and the 

impact of potential standard levels, DOE 

evaluates potential standards that would 

not lessen the utility or performance of 

the considered products. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(IV)) 

Based on data available to DOE, the 

standards proposed in this document 

would not reduce the utility or 

performance of the equipment under 

consideration in this proposed 

rulemaking. 

e. Impact of Any Lessening of 

Competition 

EPCA directs DOE to consider the 

impact of any lessening of competition, 

as determined in writing by the 

Attorney General, that is likely to result 

from a proposed standard. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(2)(B)(i)(V)) It 

also directs the Attorney General to 

determine the impact, if any, of any 

lessening of competition likely to result 

from a proposed standard and to 

transmit such determination to the 

Secretary within 60 days of the 

publication of a proposed rule, together 

with an analysis of the nature and 

extent of the impact. (42 U.S.C. 6316(a); 

42 U.S.C. 6295(o)(2)(B)(ii)) DOE will 

transmit a copy of this proposed rule to 

the Attorney General with a request that 

the Department of Justice (‘‘DOJ’’) 

provide its determination on this issue. 

DOE will publish and respond to the 

Attorney General’s determination in the 

final rule. DOE invites comment from 

the public regarding the competitive 

impacts that are likely to result from 

this proposed rule. In addition, 

stakeholders may also provide 

comments separately to DOJ regarding 

these potential impacts. See the 

ADDRESSES section for information to 

send comments to DOJ. 

f. Need for National Energy 

Conservation 

DOE also considers the need for 

national energy and water conservation 

in determining whether a new or 

amended standard is economically 

justified. (42 U.S.C. 6316(a); 42 U.S.C. 

6295(o)(2)(B)(i)(VI)) The energy savings 

from the proposed standards are likely 

to provide improvements to the security 

and reliability of the Nation’s energy 

system. Reductions in the demand for 

electricity also may result in reduced 

costs for maintaining the reliability of 

the Nation’s electricity system. DOE 

conducts a utility impact analysis to 

estimate how standards may affect the 

Nation’s needed power generation 

capacity, as discussed in section IV.M of 

this document. 

DOE maintains that environmental 

and public health benefits associated 

with the more efficient use of energy are 

important to take into account when 

considering the need for national energy 

conservation. The proposed standards 

are likely to result in environmental 

benefits in the form of reduced 

emissions of air pollutants and 

greenhouse gases (‘‘GHGs’’) associated 

with energy production and use. DOE 

conducts an emissions analysis to 

estimate how potential standards may 

affect these emissions, as discussed in 

section IV.K of this document; the 

estimated emissions impacts are 

reported in section V.B.6 of this 

document. DOE also estimates the 

economic value of emissions reductions 

resulting from the considered TSLs, as 

discussed in section IV.L of this 

document. 

g. Other Factors 

In determining whether an energy 

conservation standard is economically 

justified, DOE may consider any other 

factors that the Secretary deems to be 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87079 

relevant. (42 U.S.C. 6316(a); 42 U.S.C. 

6295(o)(2)(B)(i)(VII)) To the extent DOE 

identifies any relevant information 

regarding economic justification that 

does not fit into the other categories 

described previously, DOE could 

consider such information under ‘‘other 

factors.’’ 

2. Rebuttable Presumption 

EPCA creates a rebuttable 

presumption that an energy 

conservation standard is economically 

justified if the additional cost to the 

consumer of the equipment that meets 

the standard is less than three times the 

value of the first year’s energy savings 

resulting from the standard, as 

calculated under the applicable DOE 

test procedure. (42 U.S.C. 6313(a); 42 

U.S.C. 6295(o)(2)(B)(iii) DOE’s LCC and 

PBP analyses generate values used to 

calculate the effects that new energy 

conservation standards would have on 

the PBP for consumers. These analyses 

include, but are not limited to, the 3- 

year PBP contemplated under the 

rebuttable-presumption test. 

In addition, DOE routinely conducts 

an economic analysis that considers the 

full range of impacts to consumers, 

manufacturers, the Nation, and the 

environment, as required under 42 

U.S.C. 6313(a) and 42 U.S.C. 

6295(o)(2)(B). The results of this 

analysis serve as the basis for DOE’s 

evaluation of the economic justification 

for a potential standard level (thereby 

supporting or rebutting the results of 

any preliminary determination of 

economic justification). The rebuttable 

presumption payback calculation is 

discussed in section V.B.1.c of this 

document. 

IV. Methodology and Discussion of 

Related Comments 

This section addresses the analyses 

DOE has performed for this proposed 

rulemaking with regard to ESEMs. 

Separate subsections address each 

component of DOE’s analyses. In this 

NOPR, DOE is only addressing 

comments and analysis specific to the 

scope of motors provided in the 

December 2022 Joint Recommendation 

(i.e., ESEMs and AO–ESEMs). As such, 

any analysis and comments related to 

MEMs and AO–MEMs were addressed 

in the separate June 2023 DFR 

published on June 1, 2023. 88 FR 36066. 

DOE used several analytical tools to 

estimate the impact of the standards 

proposed in this document. The first 

tool is a spreadsheet that presents the 

calculations of the LCC savings and PBP 

of potential new energy conservation 

standards. The national impacts 

analysis uses a second spreadsheet set 

that provides shipments projections and 

calculates national energy savings and 

net present value of total consumer 

costs and savings expected to result 

from potential energy conservation 

standards. DOE uses the third 

spreadsheet tool, the Government 

Regulatory Impact Model (‘‘GRIM’’), to 

assess manufacturer impacts of potential 

standards. These three spreadsheet tools 

are available on the DOE website for this 

rulemaking: www.regulations.gov/ 

docket/EERE-2020-BT-STD-0007. 

Additionally, DOE used output from the 

latest version of the Energy Information 

Administration’s (‘‘EIA’s’’) Annual 

Energy Outlook (‘‘AEO’’), a widely 

known energy projection for the United 

States, for the emissions and utility 

impact analyses. 

A. Market and Technology Assessment 

DOE develops information in the 

market and technology assessment that 

provides an overall picture of the 

market for the products concerned, 

including the purpose of the products, 

the industry structure, manufacturers, 

market characteristics, and technologies 

used in the products. This activity 

includes both quantitative and 

qualitative assessments, based primarily 

on publicly-available information. The 

subjects addressed in the market and 

technology assessment for this proposed 

rulemaking include (1) a determination 

of the scope of the proposed rulemaking 

and equipment classes, (2) 

manufacturers and industry structure, 

(3) existing efficiency programs, (4) 

shipments information, (5) market and 

industry trends; and (6) technologies or 

design options that could improve the 

energy efficiency of ESEMs. The key 

findings of DOE’s market assessment are 

summarized in the following sections. 

See chapter 3 of the NOPR TSD for 

further discussion of the market and 

technology assessment. 

1. Scope of Coverage 

This document covers ESEMs, a 

category of electric motors. The term 

‘‘electric motor’’ is defined at 10 CFR 

431.12. Specifically, the definition for 

‘‘electric motor’’ is ‘‘a machine that 

converts electrical power into rotational 

mechanical power.’’ 10 CFR 431.12. 

In the March 2022 Preliminary 

Analysis, DOE presented analysis for 

the current scope of electric motors 

regulated at 10 CFR 431.25, in addition 

to certain expanded scope, including 

air-over electric motors, and ESEMs and 

AO–ESEMs. See chapter 2 of the March 

2022 Preliminary TSD. Since then, DOE 

has published the October 2022 Final 

Rule, which established test procedures 

for expanded scope, as discussed in 

detail in section III.B of this NOPR. 

Additionally, DOE has also published 

the June 2023 DFR, which established 

energy conservations standards for 

MEMs and AO–MEMs. 

In response to the scope presented in 

the March 2022 Preliminary Analysis, 

DOE received a number of comments, 

which are discussed in the subsections 

below. In this NOPR, DOE is only 

addressing comments and analysis 

specific to the scope of motors proposed 

in this NOPR, which includes ESEMs 

and AO–ESEMs. 

NEEA supported the inclusion of 

ESEMs in the scope of the standards. 

NEEA noted that including ESEMs will 

allow comparison of performance and 

informed purchase decisions. (NEEA, 

No. 33 at p. 2) 

AHAM and AHRI strongly opposed 

DOE’s plan to expand the existing scope 

of coverage of electric motors to include 

motors destined for particular 

applications in finished goods, and 

instead recommended that DOE should 

apply a finished-product approach to 

energy efficiency regulations. (AHAM 

and AHRI, No. 25 at pp. 7–9) Lennox 

added that it strongly objects to any 

expansion of coverage (including 

development of test procedures, energy 

conservation requirements, and/or 

certification requirements) for electric 

motors that would circumvent the 

statutory exemption that Congress 

provided for small electric motors that 

are components of EPCA-covered 

products/equipment. (Lennox, No. 29 at 

p. 3) AHAM and AHRI commented that 

they interpret the EPCA exemption for 

SEMs that are components of covered 

product and equipment as to also mean 

that small special and definite purpose 

motors, whether they are classified as 

small electric motors or as an ESEM, 

should not be subject to energy 

conservation standards. AHAM and 

AHRI stated that such motors are, by 

definition, destined for particular 

products, and when that product is a 

covered product/piece of equipment, 

that motor is destined for a product 

already subject to energy conservation 

standards and has defining features to 

identify it as such. (AHAM and AHRI, 

No. 25 at pp. 1,6) 

AHRI and AHAM further commented 

that regulating ESEMs could affect the 

following product categories: clothes 

washers (top and front load), clothes 

dryers, food waste disposers, 

refrigerators, room air conditioners, and 

stick vacuums. Apart from stick 

vacuums and food waste disposers, 

AHAM and AHRI noted that the 

products listed are already subject to 

energy conservation standards. AHAM 

and AHRI also commented that 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87080 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

28 DOE clarified, at industry’s urging, that the 

definition also includes motors that are IEC metric 

equivalents to the specified NEMA motors 

prescribed by the statute. See 74 FR 32059, 32061– 

32062 (July 7, 2009); 10 CFR 431.442. 

regulating ESEM and AO motors could 

impact the following products: small, 

large, very large commercial package air 

conditioning and heating equipment, 

residential air conditioners and heat 

pumps, single package vertical air 

conditioners and heat pumps, 

commercial and residential furnaces, 

commercial and residential boilers, 

commercial and residential water 

heaters, air cooled condensing unit, 

central station air handling units, 

geothermal heat pumps, unit coolers, 

unit ventilators, and water source heat 

pumps. (AHAM and AHRI, No. 25 at pp. 

1–2) 

HI recommended that dedicatedpurpose ESEMs should be regulated as 

part of their final product instead of as 

motors specifically. (HI, No. 31 at p. 1) 

The Joint Industry Stakeholders 

commented that they strongly object to 

any expansion of coverage (including 

development of test procedures, energy 

conservation requirements, and/or 

certification requirements) for electric 

motors that would circumvent the 

statutory exemption that Congress 

provided for small electric motors that 

are components of EPCA-covered 

products/equipment. They stated that 

embedded motor testing, and ultimately 

energy conservation standards, would 

save minimal energy and would create 

needless testing, paperwork, and recordkeeping requirements that would raise 

costs for consumers. (Joint Industry 

Stakeholders, No. 23 at pp. 3–4) The 

Joint Industry Stakeholders and AHAM 

and AHRI agreed with the previous 

determination in which DOE recognized 

that Congress intentionally excluded 

these motors from coverage by DOE 

regulation when such motors are used 

as components of products and 

equipment that are already subject to 

DOE regulation, and they noted that 

these are the motors that DOE now seeks 

to regulate as ESEMs and by expanding 

the scope of the test procedure to 1⁄4 hp. 

The Joint Industry Stakeholders and 

AHAM and AHRI added that, despite 

the similarity between ESEMs and 

SEMs, DOE is proposing to subject 

ESEMs used as components in EPCAcovered equipment/products to 

duplicative energy conservation 

standards at both the motor level and 

the finished product/equipment stage 

and that DOE provides no rationale or 

explanation for doing so. (Joint Industry 

Stakeholders, No. 23 at pp. 3–4; AHAM 

and AHRI, No. 25 at pp. 7- 9) Further, 

the Joint Industry Stakeholders 

commented that ESEMs include special 

and definite purpose motors that have 

been built to meet the needs of original 

equipment manufacturer (‘‘OEM’’) 

products. The Joint Industry 

Stakeholders added that many of these 

OEM products are already regulated by 

DOE. (Joint Industry Stakeholders, No. 

23 at p. 2) 

As discussed in the October 2022 

Final Rule, EPCA, as amended through 

EISA 2007, provides DOE with the 

authority to regulate the expanded 

scope of motors addressed in this rule. 

87 FR 63588, 63596. Before the 

enactment of EISA 2007, EPCA defined 

the term ‘‘electric motor’’ as any motor 

that is a general purpose T-frame, 

single-speed, foot-mounting, polyphase 

squirrel-cage induction motor of the 

NEMA, Design A and B, continuous 

rated, operating on 230/460 volts and 

constant 60 Hertz line power as defined 

in NEMA Standards Publication MG1– 

1987. (See 42 U.S.C. 6311(13)(A) (2006)) 

Section 313(a)(2) of EISA 2007 removed 

that definition and the prior limits that 

narrowly defined what types of motors 

would be considered as electric motors. 

In its place, EISA 2007 inserted a new 

‘‘Electric motors’’ heading, and created 

two new subtypes of electric motors: 

General purpose electric motor (subtype 

I) and general purpose electric motor 

(subtype II). (42 U.S.C. 6311(13)(A)–(B) 

(2011)) In addition, section 313(b)(2) of 

EISA 2007 established energy 

conservation standards for four types of 

electric motors: general purpose electric 

motors (subtype I) (i.e., subtype I 

motors) with a power rating of 1 to 200 

horsepower; fire pump motors; general 

purpose electric motor (subtype II) (i.e., 

subtype II motors) with a power rating 

of 1 to 200 horsepower; and NEMA 

Design B, general purpose electric 

motors with a power rating of more than 

200 horsepower, but less than or equal 

to 500 horsepower. (42 U.S.C. 

6313(b)(2)) The term ‘‘electric motor’’ 

was left undefined. However, in a May 

4, 2012 final rule amending the electric 

motors test procedure (the ‘‘May 2012 

TP Final Rule’’), DOE adopted the 

broader definition of ‘‘electric motor,’’ 

currently found in 10 CFR 431.12, 

because DOE noted that the absence of 

a definition may cause confusion about 

which electric motors are required to 

comply with mandatory test procedures 

and energy conservation standards, and 

the broader definition provided DOE 

with the flexibility to set energy 

conservation standards for other types 

of electric motors without having to 

continuously update the definition of 

‘‘electric motors’’. 77 FR 26608, 26613. 

Some electric motors included in this 

proposed rule may be sold embedded 

into covered products and equipment or 

sold alone as replacements. DOE is 

proposing new energy conservation 

standards for ESEMs in this proposed 

rule that apply to the motor’s efficiency 

regardless of whether the ESEM is being 

sold alone or embedded into a covered 

product or equipment. As discussed in 

section III.D of this document, DOE has 

determined that energy savings from the 

standard levels proposed in this NOPR 

are ‘‘significant’’ within the meaning of 

42 U.S.C. 6316(a) and 42 U.S.C. 

6295(o)(3)(B) 

The provisions of EPCA make clear 

that DOE may regulate electric motors 

‘‘alone or as a component of another 

piece of equipment.’’ (See 42 U.S.C. 

6313(b)(1) and (2) (providing that 

standards for electric motors be applied 

to electric motors manufactured ‘‘alone 

or as a component of another piece of 

equipment’’)) In contrast, Congress 

exempted SEM that are a component of 

a covered product or a covered 

equipment from the standards that DOE 

was required to establish under 42 

U.S.C. 6317(b). Congress did not, 

however, similarly restrict electric 

motors. 

Congress defined what equipment 

comprises a SEM—specifically, ‘‘a 

NEMA general purpose alternating 

current single-speed induction motor, 

built in a two-digit frame number series 

in accordance with NEMA Standards 

Publication MG1–1987.’’ 28 (42 U.S.C. 

6311(13)(G)) ESEMs, which are electric 

motors, are not SEMs because they do 

not satisfy the more specific statutory 

SEM definition. Unlike SEMs, the 

statute does not limit DOE’s authority to 

regulate an electric motor with respect 

to whether ‘‘electric motors’’ are standalone equipment items or components 

of a covered product or covered 

equipment. Rather, Congress 

specifically provided that DOE could 

regulate electric motors that are 

components of other covered equipment 

in the standards established by DOE. 

(See 42 U.S.C. 6313(b)(1) (providing that 

standards for electric motors be applied 

to electric motors manufactured ‘‘alone 

or as a component of another piece of 

equipment’’)) Accordingly, DOE 

disagrees with commenters that the 

SEM component exemption should 

apply to ESEMs and, therefore, includes 

ESEMs installed as components in other 

DOE-regulated products and equipment 

in these proposed energy conservation 

standards. 

In addition, ESEMs are built in 

standard NEMA frame sizes and are not 

common in currently regulated 

consumer products including those 

listed by AHAM and AHRI (i.e., clothes 

washers (top and front load), clothes 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87081 

29The walk-in coolers and walk-in freezers 

standards rulemaking docket number is: EERE– 

2015–BT–STD–0016. 

30The circulator pumps energy conservation 

standard rulemaking docket number is: EERE– 

2016–BT–STD–0004. 

31The commercial and industrial fans and 

blowers energy conservation standard rulemaking 

docket number is: EERE–2013–BT–STD–0006. Air 

circulating fans are a subcategory of fans. 

32The small, large, and very large air-cooled 

commercial package air conditioners and heat 

pumps energy conservation standard rulemaking 

docket number is: EERE–2013–BT–STD–0007. 

dryers, food waste disposers, 

refrigerators, room air conditioners, and 

stick vacuums). Therefore, DOE believes 

the standards proposed in this NOPR 

would not impact manufacturers of 

consumer products. In commercial 

equipment, DOE identified the 

following equipment as potentially 

incorporating ESEMs: walk-in coolers 

and freezers,29 circulator pumps,30 air 

circulating fans,31 and commercial 

unitary air conditioning equipment.32 If 

the proposed energy conservation 

standards for these rules finalize as 

proposed, DOE has identified that these 

rules would all: (1) have a compliance 

year that is at or before the ESEM 

standard compliance year (2029) and/or 

(2) require a motor that is either outside 

of the scope of this rule (e.g., an 

electronically commutated motor 

(‘‘ECM’’)) or an ESEM with an efficiency 

above the proposed ESEM standards, 

and therefore not be impacted by the 

proposed ESEM rule (i.e., the ESEM rule 

would not trigger a redesign of these 

equipment). 

Furthermore, EPCA requires that any 

new or amended standard for covered 

equipment must be designed to achieve 

the maximum improvement in energy 

efficiency that the Secretary of Energy 

determines is technologically feasible 

and economically justified. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(2)(A) and 42 

U.S.C. 6295(o)(3)(B)) In this NOPR, DOE 

performs the necessary analyses to 

determine what new standards would 

meet the aforementioned criteria. 

Further, DOE has determined that the 

proposed standards provide costeffective standards that would result in 

the significant conservation of energy. 

Further discussion on the analytical 

results and DOE’s justification is 

provided in section V of this document. 

NEEA commented that the term 

‘‘small, non-small electric motors’’ is 

confusing and recommended using 

‘‘Other Small HP Motors (OSHM)’’ or 

‘‘Other Small Electric Motors (OSEM)’’ 

as alternative options. (NEEA, No. 33 at 

p. 2) DOE has opted to use the term 

‘‘ESEM’’ in this NOPR. 

The Joint Industry Stakeholders 

commented that the proposed definition 

for ESEMs used in the March 2022 

Preliminary Analysis is vague. 

Specifically, the Joint Industry 

Stakeholders requested clarification 

regarding (1) the definition of full-rated 

load; (2) whether brushless permanent 

magnet motors were included; (3) 

whether some motors, which have 

motor assemblies that are connected to 

60 Hz and which are rectified internally 

to DC power and require brush 

maintenance were included. (Joint 

Industry Stakeholders, No. 23 at pp. 1– 

2) In response, DOE notes that the 

October 2022 Final Rule finalized a 

definition for ‘‘rated load,’’ which is 

currently provided in 10 CFR 431.12 (87 

FR 63588, 63623), and included 

specifications on what electric motors 

meet the definition of ESEM, which is 

currently provided in section 1 of 

appendix B (87 FR 63588, 63599). 

Specifically, 10 CFR 431.12 currently 

relates rated load to full-load, full rated 

load, or rated full-load, and defines it as 

‘‘the rated output power of an electric 

motor.’’ Further, section 1.1 of appendix 

B states that an ESEM means a motor 

that ‘‘is a single-speed induction motor 

capable of operating without an inverter 

or is an inverter-only electric motor’’; 

therefore, the ESEM scope does not 

include non-induction electric motors. 

However, DOE does separately include 

in scope ‘‘synchronous electric motors,’’ 

which entails an electric motor that is 

‘‘synchronous’’ and ‘‘produces at least 

0.25 hp but not greater than 750 hp’’. 

See Section 1.1, appendix B. However, 

DOE is not adopting standards for 

synchronous electric motors in this 

NOPR. Finally, the ESEM scope 

specifically states that an electric motor 

would meet the scope if it operates on 

polyphase or single-phase alternating 

current 60-hertz (Hz) sinusoidal line 

power; or is used with an inverter that 

operates on polyphase or single-phase 

alternating current 60-hertz (Hz) 

sinusoidal line power. An ‘‘inverter’’ is 

defined as ‘‘an electronic device that 

converts an input AC or DC power into 

a controlled output AC or DC voltage or 

current. An inverter may also be called 

a converter.’’ 10 CFR 431.12. 

The Joint Industry Stakeholders 

recommended that DOE exclude 

refrigeration compressor motors from 

the scope of the ESEM rulemaking. The 

Joint Industry Stakeholders explained 

that such motors are hermetically sealed 

and are cooled by the refrigerant flowing 

within the appliance/equipment, and 

that there is no accurate way to measure 

the efficiency of just the motor and thus, 

it is not appropriate or feasible to 

include refrigeration compressor motors 

in the scope of this rulemaking. (Joint 

Industry Stakeholders, No. 23 at p. 9) 

DOE defines a liquid-cooled electric 

motor as a motor that is cooled by liquid 

circulated using a designated cooling 

apparatus such that the liquid or liquidfilled conductors come into direct 

contact with the parts of the motor but 

is not submerged in a liquid during 

operation. 10 CFR 431.12. DOE 

reviewed refrigeration compressor 

motors and understands that they would 

be considered a liquid-cooled electric 

motor according to this definition 

because they require flowing refrigerant 

to adequately cool during operation. 

The designated cooling apparatus in this 

case is shared with the greater 

refrigeration system. Liquid-cooled 

electric motors are currently exempt 

from DOE’s standards for electric 

motors, generally. See 10 CFR 

431.25(l)(3). Accordingly, because the 

refrigeration compressor motor 

described by the commenters meets the 

definition of a ‘‘liquid-cooled electric 

motor,’’ it is exempt from the test 

procedure and energy conservation 

standards proposed by this NOPR. DOE 

also notes that many refrigeration 

compressor motors are not built in 

standard NEMA frame sizes, and this 

would also disqualify them from the 

scope of this NOPR. As such, DOE does 

not see a need to specifically exempt 

refrigeration compression motors from 

the scope of this NOPR, but may revisit 

the issue in the future, as necessary. 

Additionally, NEMA stated that there 

is no room for explosion proof motors 

to accommodate a run capacitor because 

of the added enclosure constraints 

associated with explosion proof motors. 

(NEMA, No. 22 at p. 3) DOE agrees with 

NEMA that the enclosure constraints for 

explosion proof motors do not allow for 

the addition of a run capacitor. The new 

standard levels proposed by this NOPR 

will not require CSIR motors to 

incorporate an additional run capacitor 

and will not require CSIR motors to be 

replaced by CSCR motors. Therefore, 

DOE believes NEMA’s concern is 

addressed. 

The CA IOUs recommended exploring 

stakeholder interest in convening an 

ASRAC Working Group to clearly define 

the scope of an ESEM regulation before 

moving forward with an energy 

conservation standard rulemaking. (CA 

IOUs, No. 30 at p. 2) In response, DOE 

notes that several members of industry 

and other stakeholders did convene on 

a negotiation, which ended in the 

December 2022 Joint Recommendation. 

The December 2022 Joint 

Recommendation limited its scope to 

high-torque and medium-torque ESEMs, 

low-torque ESEMs, and polyphase 

ESEMs. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87082 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

33See the discussion of the Data Quality Act in 

section VI.J of this document; see also 

www.energy.gov/sites/prod/files/cioprod/ 

documents/finalinfoqualityguidelines03072011.pdf. 

The Joint Industry Stakeholders also 

commented that ESEMs are the same as 

SEMs and that DOE’s reliance on the 

SEM data as an analog to ESEM 

performance demonstrates that the 

products are the same. Additionally, the 

Joint Industry Stakeholders said that 

DOE did not provide sufficient data to 

support its analysis or to allow 

commenters to fully understand, 

interpret, or analyze the March 2022 

Preliminary TSD and provide 

meaningful comment. The Joint 

Industry Stakeholders also stated that 

DOE’s reliance on old data for what 

DOE claims is a different product and 

its drawing of conclusions without 

providing further detail fails to meet the 

requirements of the Administrative 

Procedure Act (‘‘APA’’) or the Data 

Quality Act. (Joint Industry 

Stakeholders, No. 23 at pp. 2–3) As 

noted previously, EPCA provides a very 

specific definition for SEMs that DOE 

regulates under 10 CFR part 431 subpart 

X. ESEMs can be similar to SEMs in 

many aspects, but nevertheless fall 

outside of the EPCA-provided 

definition. Accordingly, ESEMs are 

treated differently for purposes of DOE’s 

energy conservation standards. That 

DOE used SEMs data as an analog to 

ESEM performance to help construct the 

March 2022 Preliminary Analysis does 

not change the fact that they are treated 

differently under EPCA, or that, as 

electric motors, DOE may regulate 

ESEMs used as components in other 

covered equipment. Notably, in 

response to the comment from the Joint 

Stakeholders, DOE has made updates to 

the ESEMs analysis in this NOPR 

compared to what was presented in the 

March 2022 Preliminary Analysis; 

specifically, DOE has performed 

additional testing, teardowns, and 

modeling of electric motors that more 

closely align with the ESEM scope and 

updated the engineering analysis 

accordingly. In addition, DOE reviewed 

the latest motor catalog data to inform 

the updated analyses. Further 

discussion on this updated analysis is 

provided in section IV.C of this 

document. Therefore, DOE has met the 

APA’s requirements as DOE has 

explained throughout this NOPR and in 

the NOPR TSD the details of the 

analysis conducted by DOE and the 

information DOE relied on in 

conducting that analysis. Further, DOE 

has complied with DOE’s guidelines for 

implementing the Data Quality Act that 

ensure the quality, objectivity, utility, 

and integrity of the data presented in 

this document.33

2. Air-Over ESEMs 

In response to the March 2022 

Preliminary Analysis, AHRI commented 

that air-over motors are explicitly 

exempted from regulation in 10 CFR 

431.25(l), and that DOE has not 

overcome the challenges to include 

these exempted products, procedurally 

or technically. AHRI added that the 

claimed similarities between SEMs and 

the newly proposed AO–ESEMs 

category warrant the same exemption 

for AO–ESEMs that Congress expressly 

provided for small electric motors, and 

AHRI referenced the requirement of 

EPCA, which says that energy 

conservation standards ‘‘shall not apply 

to any small electric motor which is a 

component of a covered product under 

section 6292(a) of this title or covered 

equipment under section 6311 of this 

title.’’ (AHRI, No. 26 at pp. 1, 2) 

With regards to the comment from 

AHRI, DOE is covering AO–ESEMs 

under its ‘‘electric motors’’ authority. 

(42 U.S.C. 6311(1)(A); 42 U.S.C. 6313(b)) 

As discussed in section III.A of this 

document, the statute does not limit 

DOE’s authority to regulate electric 

motors (that are not SEMs) with respect 

to whether they are stand-alone 

equipment items or as components of a 

covered product or covered equipment. 

See 42 U.S.C. 6313(b)(1) (providing that 

standards for electric motors be applied 

to electric motors manufactured ‘‘alone 

or as a component of another piece of 

equipment’’) AO–ESEMs do not fall 

within the SEMs definition under 

EPCA, and, therefore, DOE is regulating 

AO–ESEMs under its ‘‘electric motors’’ 

authority. 

DOE’s previous determination in the 

December 2013 Final Rule to exclude 

air-over electric motors from scope was 

due to insufficient information available 

to DOE at the time to support 

establishment of a test method. 78 FR 

75962, 75974–75975. Since that time, 

NEMA published a test standard for airover motors in Section IV, ‘‘Performance 

Standards Applying to All Machines,’’ 

Part 34 ‘‘Air-Over Motor Efficiency Test 

Method’’ of NEMA MG 1–2016 (‘‘NEMA 

Air-over Motor Efficiency Test 

Method’’). The air-over method was 

originally published as part of the 2017 

NEMA MG–1 Supplements and is also 

included in the latest version of NEMA 

MG 1–2016. Accordingly, in the October 

2022 Final Rule, DOE included air-over 

electric motors in the test procedure 

scope and established test procedures 

for such motors. 87 FR 63588, 63597. In 

this NOPR, DOE has analyzed the scope 

of electric motors based on the finalized 

test procedures and proposes new 

energy conservation standards for AO– 

ESEMs that align with the December 

2022 Joint Recommendation. 

3. Equipment Classes 

When evaluating and establishing 

energy conservation standards, DOE 

may establish separate standards for a 

group of covered products (i.e., establish 

a separate equipment class) if DOE 

determines that separate standards are 

justified based on the type of energy 

used, or if DOE determines that a 

product’s capacity or other 

performance-related feature justifies a 

different standard. (42 U.S.C. 6316(a); 

42 U.S.C. 6295(q)(1)) In making a 

determination whether a performancerelated feature justifies a different 

standard, DOE must consider such 

factors as the utility of the feature to the 

consumer and other factors DOE 

determines are appropriate. (Id.) 

In the March 2022 Preliminary 

Analysis, DOE considered potential 

equipment classes defined on the basis 

of motor horsepower rating, pole 

configuration (i.e., 2, 4, 6, or 8 poles), 

enclosure type (i.e., open or enclosed 

construction), locked-rotor torque level 

(i.e., high, medium, or low), type of 

input power (i.e., phase), and motor 

cooling approach (i.e., air-over or nonair-over). See chapter 2 of the March 

2022 Preliminary TSD. 

Regarding horsepower, DOE has 

previously established separate 

equipment classes for electric motors on 

the basis of horsepower rating. In an 

electric motors final rule that published 

on May 29, 2014 (‘‘May 2014 Electric 

Motors Final Rule’’), DOE discussed that 

horsepower is a performance attribute of 

an electric motor that is directly related 

to the capacity of an electric motor to 

perform useful work, and that 

horsepower generally scales with 

efficiency. 79 FR 30934, 30958. For 

example, a 50-horsepower electric 

motor would generally be considered 

more efficient than a 10-horsepower 

electric motor. Id. For these reasons, 

DOE has tentatively determined that 

horsepower represents a performancerelated feature that justifies separate 

equipment classes for ESEMs. 

Regarding pole configuration, DOE 

has also previously established separate 

equipment classes for electric motors on 

the basis of pole configuration. In the 

May 2014 Electric Motors Final Rule, 

DOE discussed that the number of poles 

in an induction motor determines the 

synchronous speed (i.e., revolutions per 

minute) of that motor, and that there is 

an inverse relationship between the 

number of poles and a motor’s speed. Id. 

at 79 FR 30958–30959. As the number 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87083 

of poles increases from two to four to six 

to eight, the synchronous speed drops 

from 3,600 to 1,800 to 1,200 to 900 

revolutions per minute, respectively. Id. 

The number of poles has a direct impact 

on the electric motor’s performance and 

achievable efficiency because the 

number of poles affects the amount of 

available space inside an electric motor 

that can be used to accommodate 

efficiency improvements. Id. For 

example, eight pole motors have twice 

as many poles as four-pole motors and, 

correspondingly, less space for 

efficiency improvements. Id. For these 

reasons, DOE has tentatively determined 

that pole configuration represents a 

performance-related feature that justifies 

separate equipment classes for ESEMs. 

Regarding enclosure type, DOE has 

also previously established separate 

equipment classes for electric motors on 

the basis of enclosure type. In the May 

2014 Electric Motors Final Rule, DOE 

discussed that electric motors 

manufactured with open construction 

allow a free interchange of air between 

the electric motor’s interior and exterior. 

Id. at 79 FR 30959. Whereas, electric 

motors with enclosed construction have 

no direct air interchange between the 

motor’s interior and exterior (but are not 

necessarily air-tight) and may be 

equipped with an internal fan for 

cooling. Id. Whether an electric motor is 

open or enclosed affects its utility; open 

motors are generally not used in harsh 

operating environments, whereas totally 

enclosed electric motors often are. Id. 

The enclosure type also affects an 

electric motor’s ability to dissipate heat, 

which directly affects efficiency. For 

these reasons, DOE has tentatively 

determined that the enclosure type 

represents a performance-related feature 

that justifies separate equipment classes 

ESEMs. 

Regarding locked-rotor torque level, 

DOE considered three classifications of 

locked-rotor torque in the March 2022 

Preliminary Analysis: high, medium, 

and low. The high locked-rotor torque 

motor topologies included CSCR and 

CSIR motors; the medium locked-rotor 

torque topologies included split phase 

motors; and the low locked-rotor torque 

topologies included PSC and shaded 

pole motors. Locked-rotor torque refers 

to torque developed by an electric motor 

whose rotor is locked in place, i.e., not 

rotating. Locked-rotor torque 

characterizes a motor’s ability to begin 

moving loads at rest, an attribute which 

is important to varying degree across 

applications. Certain applications, for 

example, some fans, may be relatively 

indifferent to locked-rotor torque; 

whereas for others, a minimum lockedrotor torque may be required to begin 

operation. DOE understands that high 

and medium locked-rotor torque motors 

are generally physically larger than lowlocked rotor torque motors and may not 

fit in many embedded applications that 

low locked-rotor torque motors are used 

in. Additionally, low locked-rotor 

torque motors may not provide 

sufficient starting torque (i.e., the motor 

would stall and the application would 

never start) to the many applications 

that have a high starting load (e.g., 

compressors and pumps). DOE also 

understands that high and medium 

locked-rotor torque motors generally 

operate inherently more efficiently than 

low locked-rotor torque motors. As 

such, DOE has tentatively determined 

that separate standards (i.e., separate 

equipment classes) are warranted for the 

high/medium locked-rotor torque 

topologies (i.e., CSCR, CSIR, and split 

phase) and low locked-rotor torque 

topologies (i.e., PSC and shaded pole). 

In the March 2022 Preliminary Analysis, 

DOE sought comment on whether any 

applications require a low locked-rotor 

torque and would not operate with a 

high locked-rotor torque motor, and 

whether locked-rotor torque is necessary 

to maintain as an equipment class factor 

if the highest-torque motor types (e.g., 

CSCR) can reach the highest available 

efficiency levels among the set of 

electric motors which are used as 

substitutes for similar applications. 

Section 2.3.1.2 of the March 2022 TSD. 

In response to the equipment classes 

presented in the March 2022 

Preliminary Analysis, NEMA agreed 

that locked-rotor torque (or 

alternatively, the motor technology) is 

necessary to maintain as an equipment 

class factor even if the high locked-rotor 

torque ESEMs can reach the highest 

efficiencies among the full range of 

ESEMs (regardless of locked-rotor 

torque categorization). They 

substantiated their recommendation by 

stating that certain high locked-rotor 

torque motors are often not 

interchangeable with lower locked-rotor 

torque motors in specific applications 

because of the larger physical size of the 

high locked-rotor torque motor due to 

the presence of additional capacitors. 

(NEMA, No. 22 at pp. 6–7) The 

December 2022 Joint Recommendation 

recommended equipment classes with 

locked-rotor torque as one of the 

differentiators among equipment 

classes, although in contrast to the 

March 2022 Preliminary Analysis, it 

merged the high and medium lockedrotor torque classes to form a single high 

locked-rotor torque class. DOE infers 

from this recommendation that the 

performance of split phase motors does 

not inherently differ substantially from 

the performance of CSCR and CSIR 

motors, such that a higher or lower 

energy conservation standard for split 

phase motors would not be warranted in 

relation to a standard established for 

CSCR and CSIR motors. As such, DOE 

has tentatively determined that separate 

equipment classes for ESEMs are 

warranted for two groupings of lockedrotor torque: high and medium lockedrotor torque (represented by the 

grouping of CSCR, CSIR, and split phase 

topologies) and low locked-rotor torque 

(represented by the grouping of PSC and 

shaded pole topologies). 

Regarding motor cooling approach, 

DOE discussed the differentiation 

between air-over and non-air-over 

motors in the March 2022 Preliminary 

Analysis. See section 2.3.1.2 of the 

March 2022 Preliminary TSD. DOE 

currently defines an air-over electric 

motor at 10 CFR 431.12 as an electric 

motor ‘‘rated to operate in and be cooled 

by the airstream of a fan or blower that 

is not supplied with the motor and 

whose primary purpose is providing 

airflow to an application other than the 

motor driving it.’’ As such, air-over 

motors are often designed without an 

internal fan, which allows for smaller 

packaging, reduced cost, and the 

potential for higher-efficiency 

performance because the motor is not 

driving an internal fan. DOE notes, 

however, the inability to self-cool may 

be a limitation in many applications 

where cooling airflow is unavailable or 

too variable to provide a reliable cooling 

source. For these reasons, DOE has 

tentatively determined that the cooling 

approach represents a performancerelated feature that justifies separate 

equipment classes for AO–ESEMs. 

Based on the above considerations, 

DOE is proposing to establish 

equipment class groupings for ESEMs 

based on the following characteristics: 

horsepower rating, pole configuration 

(i.e., 2, 4, 6, or 8 poles), enclosure type 

(i.e., open or enclosed), locked-rotor 

torque level (i.e., high and medium 

locked-rotor torque, represented by the 

grouping of CSCR, CSIR, and split phase 

topologies; and low locked-rotor torque, 

represented by the grouping of PSC and 

shaded pole topologies), type of input 

power (i.e., phase), and motor cooling 

approach (i.e., air-over or non-air-over). 

Table IV–1 presents the equipment class 

groups proposed in this NOPR. Within 

each equipment class group, DOE would 

establish individual equipment classes 

for each pole configuration, enclosure 

type, and horsepower range. The 

equipment class groups shown in Table 

IV–1 represent a total of 350 equipment 

classes. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87084 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE IV–1—EQUIPMENT CLASS GROUPS

Equipment class 

groups (‘‘ECG’’) Motor topology Horsepower rating 

Pole 

configuration Enclosure Cooling requirements 

1 .................................... CSCR, CSIR, Split Phase ................................ .25–3 2, 4, 6, 8 Open ..............

Enclosed. 

Non-Air-Over. 

2 .................................... PSC, Shaded Pole ........................................... .25–3 2, 4, 6, 8 Open ..............

Enclosed. 

Non-Air-Over. 

3 .................................... Polyphase ........................................................ .25–3 2, 4, 6, 8 Open ..............

Enclosed. 

Non-Air-Over. 

4 .................................... CSCR, CSIR, Split Phase ................................ .25–3 2, 4, 6, 8 Open ..............

Enclosed. 

Air-Over 

5 .................................... PSC, Shaded Pole ........................................... .25–3 2, 4, 6, 8 Open ..............

Enclosed. 

Air-Over 

6 .................................... Polyphase ........................................................ .25–3 2, 4, 6, 8 Open .............. Air-Over 

DOE requests comment on the 

proposed equipment classes for this 

NOPR. 

4. Technology Options 

In the March 2022 Preliminary 

Analysis market and technology 

assessment, DOE identified several 

technology options that were initially 

determined to improve the efficiency of 

ESEMs, as measured by the DOE test 

procedure. Table IV–2 presents the 

technology options considered in the 

March 2022 Preliminary Analysis. 

TABLE IV–2—MARCH 2022 PRELIMINARY ANALYSIS TECHNOLOGY OPTIONS TO INCREASE MOTOR EFFICIENCY

Type of loss to reduce Technology option 

Stator I2R Losses ..................................................................................... Increase cross-sectional area of copper in stator slots. 

Decrease the length of coil extensions. 

Rotor I2R Losses ...................................................................................... Increase cross-sectional area of end rings. 

Increase cross-sectional area of rotor conductor bars. 

Use a die-cast copper rotor cage. 

Core Losses ............................................................................................. Use electrical steel laminations with lower losses (watts/lb). 

Use thinner steel laminations. 

Increase stack length (i.e., add electrical steel laminations). 

Friction and Windage Losses ................................................................... Optimize bearing and lubrication selection. 

Improve cooling system design. 

Stray-Load Losses .................................................................................... Reduce skew on rotor cage.

Improve rotor bar insulation. 

DOE maintains the same technology 

options from the March 2022 

Preliminary Analysis in this NOPR. 

DOE received a number of comments 

regarding technology options. As these 

options are applicable to electric 

motors, broadly, DOE responded to 

these comments in the June 2023 DFR 

and refers to that discussion for 

purposes of technology options 

considered in this NOPR. See 88 FR 

36066, 36089–36090. 

5. Imported Embedded Motors 

In response to the March 2022 

Preliminary Analysis, DOE received 

comments regarding compliance 

logistics and general issues regarding 

embedded motors being imported into 

the United States. NEMA commented 

that they estimate between 30 and 60 

percent of ESEMs will be imported as a 

motor or embedded in a piece of 

equipment, and that the importers of 

these equipment are the responsible 

parties to comply. NEMA stated that if 

DOE ignores these importers, the rule 

will harm American equipment 

manufacturers incorporating ESEMs 

who compete with offshore suppliers 

and will not maintain a ‘‘level playing 

field’’ amongst motor manufacturers. 

NEMA added that they believe that 

adding the ESEM categories as defined 

in the March 2022 Preliminary TSD will 

have significant negative effects on U.S. 

suppliers and jobs, giving offshore 

equipment producers an unfair 

advantage over American producers. 

NEMA continued by saying that if DOE 

does not provide a funded and feasible 

border enforcement plan, the energy 

savings estimates for a regulation for 

ESEM will need to be adjusted by 

removing the savings of the offshore 

motors that escape regulation. (NEMA, 

No. 22 at pp. 18–19) DOE recognizes 

that importing embedded motors within 

larger pieces of equipment poses 

logistical challenges regarding the 

compliance of these embedded motors 

with the new energy conservation 

standards. However, DOE notes that 

imported motors that meet the scope 

criteria proposed in this NOPR will be 

subject to the energy conservation 

standards that are being promulgated 

regardless of whether the motor is 

imported on its own or embedded in a 

separate piece of equipment. DOE is 

committed to enforcing its regulations 

in a fair and equitable manner to ensure 

a level playing field is preserved for 

domestic manufacturers. 

B. Screening Analysis 

DOE uses the following five screening 

criteria to determine which technology 

options are suitable for further 

consideration in an energy conservation 

standards rulemaking: 

(1) Technological feasibility. 

Technologies that are not incorporated 

in commercial products or in 

commercially viable, existing prototypes 

will not be considered further. 

(2) Practicability to manufacture, 

install, and service. If it is determined 

that mass production of a technology in 

commercial products and reliable 

installation and servicing of the 

technology could not be achieved on the 

scale necessary to serve the relevant 

market at the time of the projected 

compliance date of the standard, then 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87085 

that technology will not be considered 

further. 

(3) Impacts on product utility. If a 

technology is determined to have a 

significant adverse impact on the utility 

of the product to subgroups of 

consumers, or result in the 

unavailability of any covered product 

type with performance characteristics 

(including reliability), features, sizes, 

capacities, and volumes that are 

substantially the same as products 

generally available in the United States 

at the time, it will not be considered 

further. 

(4) Safety of technologies. If it is 

determined that a technology would 

have significant adverse impacts on 

health or safety, it will not be 

considered further. 

(5) Unique-pathway proprietary 

technologies. If a technology has 

proprietary protection and represents a 

unique pathway to achieving a given 

efficiency level, it will not be 

considered further, due to the potential 

for monopolistic concerns. 

10 CFR 431.4; 10 CFR part 430, 

subpart C, appendix A, 6(c)(3) and 7(b). 

In summary, if DOE determines that a 

technology, or a combination of 

technologies, fails to meet one or more 

of the listed five criteria, it will be 

excluded from further consideration in 

the engineering analysis. The reasons 

for eliminating any technology are 

discussed in the following sections. 

The subsequent sections include 

comments from interested parties 

pertinent to the screening criteria, 

DOE’s evaluation of each technology 

option against the screening analysis 

criteria, and whether DOE determined 

that a technology option should be 

excluded (‘‘screened out’’) based on the 

screening criteria. 

1. Screened-Out Technologies 

In the March 2022 Preliminary TSD, 

DOE screened out amorphous metal 

laminations and plastic bonded iron 

powder (‘‘PBIP’’) from the analysis. DOE 

requested further data on the feasibility 

of amorphous steel being used in 

electric motors at scale. See chapter 3 of 

the March 2022 Preliminary TSD. In 

response, DOE received comments 

regarding the technologies excluded 

from this engineering analysis, which 

DOE responded to in the June 2023 DFR 

as those comments are applicable to the 

broader suite of electric motors 

(including ESEMs). In the June 2023 

DFR, DOE determined that it was not 

definitive that amorphous steel could 

meet all the screening criteria, and 

therefore, DOE continued to screen out 

amorphous metal in the June 2023 DFR 

on the basis of technological feasibility. 

88 FR 36066, 36091. That reasoning 

continues to apply in the case of the 

ESEMs within the scope of this NOPR. 

Accordingly, consistent with the 

March 2022 Preliminary Analysis and 

the June 2023 DFR, DOE is continuing 

to screen out amorphous metal 

laminations and PBIP in this NOPR. 

2. Remaining Technologies 

In the March 2022 Preliminary TSD, 

DOE did not screen out the following 

technology options: increasing crosssectional area of copper in stator slots; 

decreasing the length of coil extensions; 

increasing cross-sectional area of end 

rings; increasing cross-sectional area of 

rotor conductor bars; using a die-cast 

copper rotor cage; using electrical steel 

laminations with lower losses (watts/lb); 

using thinner steel laminations; 

increasing stack length; optimizing 

bearing and lubrication selection; 

improving cooling system design; 

reducing skew on rotor cage; and 

improving rotor bar insulation. See 

chapter 3 of the March 2022 Preliminary 

TSD. DOE received comments regarding 

the remaining technologies included in 

this engineering analysis, which were 

responded to in the June 2023 DFR as 

those comments are applicable to the 

broader suite of electric motors 

(including ESEMs). 88 FR 36066, 

36091–36092. DOE believes the 

responses to those comments in the June 

2023 DFR are applicable to this 

discussion regarding ESEMs. 

Accordingly, DOE has not screened out 

any of these technologies for its analysis 

in this NOPR. 

Otherwise, through a review of each 

technology, DOE concludes that all of 

the other identified technologies listed 

in this section met all five screening 

criteria to be examined further as design 

options in DOE’s NOPR analysis. The 

design options screened-in are 

consistent with the design options from 

the March 2022 Preliminary Analysis. 

DOE determined that these technology 

options are technologically feasible 

because they are being used or have 

previously been used in commerciallyavailable equipment or working 

prototypes. DOE also finds that all of the 

remaining technology options meet the 

other screening criteria (i.e., practicable 

to manufacture, install, and service and 

do not result in adverse impacts on 

consumer utility, product availability, 

health, or safety). For additional details, 

see chapter 4 of the NOPR TSD. 

DOE requests comment on the 

remaining technology options 

considered in this NOPR. 

C. Engineering Analysis 

The purpose of the engineering 

analysis is to establish the relationship 

between the efficiency and cost of 

ESEMs. There are two elements to 

consider in the engineering analysis; the 

selection of efficiency levels to analyze 

(i.e., the ‘‘efficiency analysis’’) and the 

determination of product cost at each 

efficiency level (i.e., the ‘‘cost 

analysis’’). In determining the 

performance of higher-efficiency 

equipment, DOE considers technologies 

and design option combinations not 

eliminated by the screening analysis. 

For each equipment class, DOE 

estimates the baseline cost, as well as 

the incremental cost for the product/ 

equipment at efficiency levels above the 

baseline. The output of the engineering 

analysis is a set of cost-efficiency 

‘‘curves’’ that are used in downstream 

analyses (i.e., the LCC and PBP analyses 

and the NIA). 

1. Efficiency Analysis 

DOE typically uses one of two 

approaches to develop energy efficiency 

levels for the engineering analysis: (1) 

relying on observed efficiency levels in 

the market (i.e., the efficiency-level 

approach), or (2) determining the 

incremental efficiency improvements 

associated with incorporating specific 

design options to a baseline model (i.e., 

the design-option approach). Using the 

efficiency-level approach, the efficiency 

levels established for the analysis are 

determined based on the market 

distribution of existing equipment (in 

other words, based on the range of 

efficiencies and efficiency level 

‘‘clusters’’ that already exist on the 

market). Using the design option 

approach, the efficiency levels 

established for the analysis are 

determined through detailed 

engineering calculations and/or 

computer simulations of the efficiency 

improvements from implementing 

specific design options that have been 

identified in the technology assessment. 

DOE may also rely on a combination of 

these two approaches. For example, the 

efficiency-level approach (based on 

actual products on the market) may be 

extended using the design option 

approach to ‘‘gap fill’’ levels (to bridge 

large gaps between other identified 

efficiency levels) and/or to extrapolate 

to the max-tech level (particularly in 

cases where the max-tech level exceeds 

the maximum efficiency level currently 

available on the market). 

In this proposed rulemaking, DOE 

applied a combination of the efficiencylevel approach and the design-option 

approach to establish efficiency levels to 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87086 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

analyze. The design-option approach 

was used to characterize efficiency 

levels that are not available on the 

market but appear to be market 

solutions for those higher efficiency 

levels if sufficient demand existed. For 

the efficiency levels available on the 

market, sufficient performance data was 

publicly available to characterize these 

levels. 

a. Representative Units Analyzed 

Due to the large number of equipment 

classes, DOE did not directly analyze all 

equipment classes of electric motors 

considered in this NOPR. Instead, DOE 

selected representative units based on 

two factors: (1) the quantity of motor 

models available within an equipment 

class and (2) the ability to scale to other 

equipment classes. 

For this NOPR, DOE updated the 

horsepower output and pole 

configuration in response to feedback 

received on the March 2022 Preliminary 

Analysis and on feedback received 

through manufacturer interviews. For 

more information on the manufacturer 

interviews, see section IV.J.2 of this 

document. Table IV–3 presents the 

representative units analyzed, and the 

covered horsepower ranges for each of 

the representative units. 

TABLE IV–3 REPRESENTATIVE UNITS ANALYZED

ECG 

Representative 

unit 

(RU) 

Representative 

unit horsepower 

Represented 

horsepower range 

(all poles, all enclosures) 

ESEM High Torque ......................................................................................... 1 0.25 0.25 ≤ hp ≤ 0.50. 

2 1 0.5 < hp ≤ 3. 

ESEM Low Torque .......................................................................................... 3 0.25 0.25 hp. 

4 0.5 0.25 < hp ≤ 3. 

ESEM Polyphase ............................................................................................ 5 0.25 0.25 ≤ hp ≤ 3. 

AO–ESEM High Torque .................................................................................. 6 0.25 0.25 ≤ hp ≤ 0.50. 

7 1 0.5 < hp ≤ 3. 

AO–ESEM Low Torque ................................................................................... 8 0.25 0.25 hp. 

9 0.5 0.25 < hp ≤ 3 

AO–ESEM Polyphase ..................................................................................... 10 0.25 0.25 ≤ hp ≤ 3. 

In response to the March 2022 

Preliminary Analysis, DOE received a 

comment from NEMA stating that DOE 

should conduct more testing of motor 

efficiency at higher efficiency levels 

rather than relying so heavily on scaled 

results. (NEMA, No. 22 at pp. 15, 24) 

DOE notes that teardowns of motors at 

higher efficiency levels were conducted 

for each ECG that was directly analyzed. 

This comment was also discussed in 

section IV.C.1 of the June 2023 DFR. See 

88 FR 36066, 36093. DOE believes the 

responses to that comment in the June 

2023 DFR are applicable to this 

discussion regarding ESEMs. 

Additionally, for more information on 

scaling as it pertains to ESEMs, see 

section IV.C.5 of this document. 

DOE requests comment on the 

representative units used in this NOPR. 

b. Baseline Efficiency 

For each equipment class, DOE 

generally selects a baseline model as a 

reference point for each class and 

measures changes resulting from 

potential energy conservation standards 

against the baseline. The baseline model 

in each equipment class represents the 

characteristics of an equipment typical 

of that class (e.g., capacity, physical 

size). Generally, a baseline model is one 

that just meets current energy 

conservation standards, or, if no 

standards are in place, the baseline is 

typically the most common or least 

efficient unit on the market. 

In the March 2022 Preliminary 

Analysis, DOE generated a baseline 

efficiency level for ESEMs by creating a 

curve-fit of motor losses vs. hp based on 

the SEM energy conservation standards 

located at 10 CFR 431.446, and shifting 

this curve-fit down to fit what was 

observed in catalog data for a given 

ESEM ECG. See chapter 5 of the March 

2022 Preliminary TSD. In response to 

the March 2022 Preliminary Analysis, 

DOE received comments on how the 

baseline efficiencies were established 

for ESEMs. 

The Joint Advocates commented that 

DOE tested five ESEMs with and 

without the fan using the proposed 

NOPR test procedure to determine the 

difference in efficiency between AO and 

non-AO motors. Removing the motor 

fan resulted in baseline efficiencies 

several percent higher for the AO– 

ESEMs. As such, the Joint Advocates 

recommend that DOE analyze 

appropriate baseline efficiency levels for 

AO motors. (Joint Advocates, No. 27 at 

p. 3) 

NEMA disagreed with how DOE 

created the baseline for ESEMs and 

suggested that the baseline be 

determined through testing and not rely 

on unverified performance models. 

(NEMA, No. 22 at p. 15) With regards 

to the comment from NEMA, DOE 

acknowledges that testing individual 

models is the most ideal way to gather 

performance data for electric motors. 

However, due to the very high volume 

of combinations of motor topologies, 

horsepower, frame sizes, pole counts, 

speeds, unique motor construction, and 

other parameters, DOE has recognized it 

to be unrealistic to test every possible 

motor available in the U.S. market. As 

such, DOE is modeling performance 

using a catalog of all electric motors 

(including ESEMs) available for sale in 

the U.S. market, which contains specific 

data for all relevant parameters of 

electric motor performance, including 

locked rotor torque, pole count, 

horsepower output, speed, nominal 

efficiency, current draw, as well as 

many others. DOE created the baseline 

using a similar combination of the 

catalog performance data and trends 

that DOE developed and modeled in the 

2010 SEM standard rulemaking when 

DOE was similarly faced with a high 

volume of potential SEM model 

possibilities. Given the similarities 

between SEMs and ESEMs, DOE 

believes that a baseline created with a 

methodology parallel to the previous 

SEM rulemaking is a reasonable 

approach for creating energy 

conservation standards for ESEMs. 

Accordingly, in this NOPR, DOE used a 

mix of catalog data, current SEM 

standards, and test data to establish the 

baseline efficiencies. For ECGs 1–3, 

DOE began with the methodology that 

was used in March 2022 Preliminary 

Analysis to establish the baseline. For 

ECGs 1 and 3, DOE then shifted the 

baseline (i.e., increased the losses across 

all horsepowers by a flat multiplier to 

shift the entire curve uniformly) to 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87087 

account for the least efficient ESEMs in 

each ECG at various horsepower ratings. 

For ECG 2, DOE used test data to 

determine the efficiency of shaded pole 

motors at the horsepower ratings where 

they are used and combined that with 

the shifted SEM standard to create a 

baseline. For more information, see 

chapter 5 of the NOPR TSD. 

DOE requests comment on the 

baseline efficiencies used in this NOPR. 

c. Higher Efficiency Levels 

As part of DOE’s analysis, the 

maximum available efficiency level is 

the highest efficiency unit currently 

available on the market. DOE also 

defines a ‘‘max-tech’’ efficiency level to 

represent the maximum possible 

efficiency for a given equipment. 

In the March 2022 Preliminary 

Analysis, DOE established the higher 

efficiency levels by shifting the baseline 

efficiencies up a certain number of 

NEMA bands. In response to the March 

2022 Preliminary Analysis, DOE 

received comments regarding the 

analysis used to determine efficiencies 

at higher levels, which were responded 

to in the June 2023 DFR. 88 FR 36066, 

36096–36097. In that final rule, DOE 

determined that the approach used in 

the March 2022 Preliminary Analysis 

continued to be appropriate. Id. at 88 FR 

36097. DOE believes the rationale from 

its responses in the June 2023 DFR is 

applicable to this NOPR. As such, for 

this NOPR, DOE considered several 

design options for higher efficiencies: 

improved electrical steel for the stator 

and rotor, using die-cast copper rotors, 

increasing stack length, and any other 

applicable design options remaining 

after the screening analysis when 

improving electric motor efficiency from 

the baseline level up to a max-tech 

level. As each of these design options 

are added, the manufacturer’s cost 

generally increases and the electric 

motor’s efficiency improves. DOE 

worked with a subject matter expert 

with design experience and motor 

performance simulation software to 

develop the highest efficiency levels 

technologically feasible for each 

representative unit analyzed, and used a 

combination of electric motor software 

design programs and subject matter 

expert input to develop these levels. 

The subject matter expert also checked 

his designs against tear-down data and 

calibrated his software using the 

relevant test results. DOE notes that for 

all efficiency levels of directly modeled 

representative units, the frame size was 

constrained to that of the baseline unit. 

DOE also notes that the full-load speed 

of the simulated motors did not stay the 

same throughout all efficiency levels. 

Depending on the materials used to 

meet a given efficiency level, the fullload speed of the motor may increase 

compared to a lower efficiency model, 

but for the representative units analyzed 

this was not always the case. Employing 

these design options, higher efficiency 

levels can be reached without resulting 

in any significant size increase and 

without changing the key electrical and 

mechanical characteristics of the motor. 

See chapter 5 of the NOPR TSD for more 

details on the full-load speeds of 

modeled units. 

DOE requests comment on the 

proposal to constrain the frame size of 

all efficiency levels to that of the 

baseline unit. 

For the max-tech efficiencies in the 

engineering analysis, DOE considered 

35H210 silicon steel, which has the 

lowest theoretical maximum core loss of 

all steels considered in this engineering 

analysis, and the thinnest practical 

thickness for use in motor laminations. 

The max-tech designs also have the 

highest possible slot fill, maximizing the 

number of motor laminations that can fit 

inside the motor. Further details are 

provided in chapter 5 of the NOPR TSD. 

The max-tech for all equipment 

classes was created by using the curve 

shape of motor losses vs. horsepower for 

the SEM energy conservation standards 

and shifting that curve up to intersect 

with the representative unit efficiencies 

for a given ECG. For intermediate 

efficiency levels that were higher than 

an ECG’s baseline but not the max-tech 

efficiency considered, DOE used a 

consistent approach across all ECGs. EL 

1 was an average of the full-load 

efficiencies of the baseline, EL 2 

contained the levels recommended in 

the December 2022 Joint 

Recommendation, and EL 3 was an 

average of the full-load efficiencies of 

EL 2 and max-tech. 

Table IV–4 presents a summary of the 

description of the higher efficiency 

levels analyzed in this NOPR. For 

additional details on the efficiency 

levels, see chapter 5 of the NOPR TSD. 

TABLE IV–4—HIGHER EFFICIENCIES ANALYZED

EL0 EL1 EL2 EL3 EL4 

Baseline ..................... Average of EL0 and EL2 ........... Joint Recommended Levels ...... Average of EL2 and EL4 ........... Max-tech. 

2. Cost Analysis 

The cost analysis portion of the 

engineering analysis is conducted using 

one or a combination of cost 

approaches. The selection of cost 

approach depends on a suite of factors, 

including the availability and reliability 

of public information, characteristics of 

the regulated equipment, the availability 

and timeliness of purchasing the 

equipment on the market. The cost 

approaches are summarized as follows: 

b Physical teardowns: Under this 

approach, DOE physically dismantles a 

commercially available equipment, 

component-by-component, to develop a 

detailed bill of materials for the product. 

b Catalog teardowns: In lieu of 

physically deconstructing an 

equipment, DOE identifies each 

component using parts diagrams 

(available from manufacturer websites 

or appliance repair websites, for 

example) to develop the bill of materials 

for the equipment. 

b Price surveys: If neither a physical 

nor catalog teardown is feasible (for 

example, for tightly integrated products 

such as fluorescent lamps, which are 

infeasible to disassemble and for which 

parts diagrams are unavailable) or costprohibitive and otherwise impractical 

(e.g. large commercial boilers), DOE 

conducts price surveys using publicly 

available pricing data published on 

major online retailer websites and/or by 

soliciting prices from distributors and 

other commercial channels. 

In the March 2022 Preliminary 

Analysis, DOE conducted the analysis 

using a combination of physical 

teardowns and software modeling. DOE 

contracted a professional motor 

laboratory to disassemble various 

electric motors and record what types of 

materials were present and how much 

of each material was present, recorded 

in a final bill of materials (‘‘BOM’’). To 

supplement the physical teardowns, 

software modeling by a subject matter 

expert was also used to generate BOMs 

for select efficiency levels of directly 

analyzed representative units. The 

resulting bill of materials provides the 

basis for the manufacturer production 

cost (‘‘MPC’’) estimates. See chapter 5 of 

the March 2022 Preliminary TSD. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87088 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

34 DOE believes there will be several impacts of 

larger motors on downstream users and consumers 

of these motors, and the difficulty to accommodate 

a larger motor varies across applications. An 

increase in motor size may result in new motors 

that fit in their existing systems. DOE notes that this 

impact to OEMs and end users may be difficult to 

quantify because of range of applications these 

motors go into, and DOE expects the potential 

impacts of larger motors to vary by end use 

application. 

35Suction motor design & operation are described 

at www.ristenbatt.com/xcart/Suction-Motor-Designand-Operation.html—(last accessed on 5/31/2023). 

36A major application of Universal Motors is 

electric vacuum cleaners. ‘‘Universal motor’’ is 

defined at www.nidec.com/en/technology/motor/ 

glossary/000/0565/ (last accessed on 5/31/2023). 

In response to the March 2022 

Preliminary Analysis, DOE received a 

number of comments pertaining to the 

cost analysis, which were responded to 

in the June 2023 DFR. 88 FR 36066, 

36098–36099. In that final rule, DOE 

determined that the approach used in 

the March 2022 Preliminary Analysis 

continued to be appropriate. Id. at 88 FR 

36099. DOE believes the rationale from 

its responses in the June 2023 DFR is 

applicable to this NOPR. Accordingly, 

in this NOPR, DOE continues to use the 

approach from the March 2022 

Preliminary Analysis by determining 

costs using a combination of physical 

teardowns and software modeling. In 

addition, as part of this NOPR, DOE 

supplemented other critical inputs to 

the MPC estimate, including material 

prices assumed, scrap costs, overhead 

costs, and conversion costs incurred by 

the manufacturer, using information 

provided by manufacturers under a 

nondisclosure agreement (‘‘NDA’’) 

through both manufacturer interviews 

and the Electric Motors Working Group. 

Through these nondisclosure 

agreements, DOE solicited and received 

feedback on inputs like recent electrical 

steel prices by grade, the cost of critical 

components of ESEMs like capacitors or 

conductors, motors at different 

efficiency levels, and rated motor 

output. See chapter 5 of the NOPR TSD 

for more detail on the scrap, overhead, 

and conversion costs, as well as material 

prices used. 

Finally, to account for manufacturers’ 

non-production costs and profit margin, 

DOE applies a non-production cost 

multiplier (the manufacturer markup) to 

the MPC. The resulting manufacturer 

selling price (‘‘MSP’’) is the price at 

which the manufacturer distributes a 

unit into commerce. DOE developed an 

average manufacturer markup by 

examining the annual Securities and 

Exchange Commission (‘‘SEC’’) 10–K 

reports filed by publicly-traded 

manufacturers primarily engaged in 

ESEM manufacturing and whose 

combined product range includes 

ESEMs. DOE used a non-production 

markup of 37 percent for all ESEMs 

considered in this NOPR. 

3. Technical Specifications 

DOE received comments in response 

to the March 2022 Preliminary Analysis 

regarding the technical design and 

performance specifications of ESEMs 

analyzed in this NOPR. The Joint 

Industry Stakeholders and AHAM and 

AHRI commented that more-efficient 

motors become heavier and larger and 

that DOE needs to account for the loss 

of consumer demanded utility in terms 

of portability or ease of lifting by one 

person. (Joint Industry Stakeholders, 

No. 23 at p. 6; AHAM and AHRI, No. 25 

at p. 12) The Joint Industry Stakeholders 

commented that DOE must factor 

portability into its calculations and 

considerations for technological 

feasibility or risk violation of EPCA 

provision 42 U.S.C. 6295(o)(2)(B)(i)(I)– 

(VII) The Joint Industry Stakeholders 

provided results of the AHAM Home 

Comfort Survey showing that portability 

is important to PAC owners. The Joint 

Industry Stakeholders added that DOE 

should screen out technology options 

that increase weight and should not use 

it as a design option in its analysis of 

higher efficiency levels. The Joint 

Industry Stakeholders added that DOE 

must account for physical growth (i.e., 

girth) of appliances as a result of 

incorporation of larger ESEMs as a 

consumer-demanded utility with 

regards to portability, or fall short of 

EPCA 6295(o)(2)(B)(i)(I)–(VII). (Joint 

Industry Stakeholders, No. 23 at pp. 6– 

8) AHAM and AHRI noted that space 

constraints in many appliances require 

that manufacturers use the smallest 

possible component that meets the 

required performance for the product. 

Additionally, they stated larger motors 

will also decrease the space available for 

additional features, thereby preventing 

finished product manufacturers from 

offering those features to consumers. 

(AHAM and AHRI, No. 25 at p. 12) 

In response to these comments, DOE 

notes that size increase of ESEMs 

analyzed as part of this NOPR is limited, 

and efficiency levels at or below the 

levels recommended in the December 

2022 Joint Recommendation will not 

result in a significant weight increase 

relative to the present weight of ESEMs, 

specifically at the selected TSL 2 (i.e., 

recommended level). DOE revised the 

preliminary analysis to account for 

space-constrained and non-space 

constrained motor designs that actively 

limit the amount of additional active 

material that can fit into the ESEM, 

limiting the potential for size and 

weight increase as well. DOE’s analysis 

assumes that higher ELs can be reached 

without significant increase in size. 

DOE made this assumption to analyze a 

representative unit that could be more 

widely adopted without significant 

redesign from end-users. However, as 

discussed in section II.B.3 of this 

document, the Electric Motor Working 

Group expressed that any efficiency 

requirements at or above EL 3, could 

result in market disruption and may not 

allow smaller size motors to remain on 

the market. DOE acknowledges that at or 

above EL 3, some manufacturers may 

choose to rely on design options that 

would significantly increase the 

physical size of ESEMs. This could 

result in a significant and widespread 

disruption to the OEM markets that 

used ESEMs as an embedded product, 

as those OEMs may have to make 

significant changes to their equipment 

that use ESEMs because those ESEMs 

could become larger in physical size.34

DOE requests comment on the 

assumption that higher ELs (particularly 

ELs 3 and 4) can be reached without 

significant increase in size. 

DOE requests comment on the 

potential for market disruption at higher 

ELs and if manufacturers could design 

motors at ELs 3 and 4 that do not 

increase in size, or if for the final rule, 

DOE should model motors larger than 

what is considered in this NOPR. 

The Joint Industry Stakeholders 

commented that if lower speed motors 

are no longer available, appliances may 

be forced to incorporate higher speed 

motors which may cause short-cycling 

in HVAC and refrigeration applications 

and result in negative impacts in other 

appliances. The Joint Industry 

Stakeholders provided the example of a 

vacuum cleaner where a higher speed 

motor could lead to increased suction 

and reduce the ability to move the 

vacuum. (Joint Industry Stakeholders, 

No. 23 at pp. 8–9) 

DOE notes that the ESEM 

performance models generated by the 

subject matter expert for the 

representative units did not always 

increase in speed as efficiency increased 

and that the energy conservation 

standards proposed by this NOPR apply 

to motors of varying operating speeds 

across multiple pole-configurations. As 

such, DOE does not expect the 

respective standard levels and 

equipment classes to result in the 

unavailability of motors with specific 

speed characteristics. DOE has also 

found that many vacuum cleaners 

currently on the market utilize 

suction 35 motors and universal 36

motors that have brushes, and are not 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87089 

37See ‘‘How to cross reference an OEM motor.’’ 

Available at http://hvacknowitall.com/blog/how-tocross-reference-an-oem-motor (last accessed 

September 28, 2023); Rheem and Ruud PROTECH 

‘‘Selecting a Motor.’’ Available at 

assets.unilogcorp.com/267/ITEM/DOC/PROTECH_

51_100998_33_Catalog.pdf (last accessed 

September 28, 2023). 

38See www.emotorsdirect.ca/hvac. 

single-speed induction motors, thus are 

not within the scope of this NOPR. 

AHAM and AHRI commented that 

they expect electric motors, particularly 

fractional horsepower electric motors, 

would increase in price because larger/ 

faster motors will require additional 

materials for the motor stack, windings, 

and other components. Moreover, 

AHAM and AHRI commented that 

efficiency requirements could push 

manufacturers to different, more 

expensive, motor topologies. AHAM 

and AHRI added that the certification, 

testing, and reporting requirements will 

also add cost. AHAM and AHRI 

provided an estimate that 6,015 basic 

models of equipment would have one or 

more motors under the scope of this 

proposed regulation. Applying a 

$304,000 per basic model cost estimate 

to redesign the equipment to 

accommodate a redesigned motor, 

AHAM and AHRI estimate the cost of 

this regulation for OEMs will exceed 

$1.83 billion. (AHAM and AHRI, No. 25 

at pp. 9–12) 

The Joint Industry Stakeholders and 

Lennox stated that if a new ESEM 

cannot be incorporated into an existing, 

previously-purchased appliance or OEM 

product, the consumer must source 

salvage/repaired component motors or 

purchase new products entirely. The 

Joint Stakeholders and Lennox 

commented that consumers will either 

face significant repair bills due to field 

modifications to incorporate new ESEM 

or lost use of devices due to inability to 

repair with a new ESEM. The Joint 

Industry Stakeholders and Lennox 

commented that DOE did not 

incorporate the impact of consumers 

being forced to prematurely purchase 

new equipment. The Joint Industry 

Stakeholders and Lennox added that 

DOE fails to account for these additional 

OEM equipment repair costs and for the 

fact that many consumers will be left 

without a repair option and forced to 

prematurely purchase new equipment 

or a new appliance and place additional 

burden on low-income consumers. 

(Joint Industry Stakeholders, No. 23 at 

pp. 5–6; Lennox, No. 29 at p. 5) AHAM 

and AHRI commented that setting 

energy conservation standards on 

motors that are components of finished 

goods would result in unavailability of 

replacement motors and consumers 

would be forced to purchase a new 

appliance they cannot afford because 

the existing equipment can no longer be 

serviced. (AHAM and AHRI, No. 25 at 

p. 10) 

Lennox commented that DOE must 

thoroughly evaluate the loss of 

repairability for installed/owned 

HVACR systems that contain newly 

regulated ESEMs, which could force 

consumers to undertake unnecessary 

and costly premature replacement of 

HVACR systems. (Lennox, No. 29 at p. 

5) 

As discussed previously in this 

section, DOE revised the engineering 

analysis from the March 2022 

Preliminary Analysis, and, as such, the 

proposed standards in this NOPR result 

in no significant increases to the size of 

an affected ESEM, which means there is 

no loss in repairability for previouslypurchased appliances because the form, 

fit, and function of the ESEMs are 

maintained at the proposed TSLs. In 

addition, the proposed levels would 

preserve key criteria that are used to 

identify suitable replacement motors,37

such as frame sizes, voltages, 

horsepower, pole configurations, 

enclosure constructions, and mountings, 

and DOE believes drop-in replacement 

motors would remain available and 

there would be no major market 

disruption, as highlighted by the 

Electric Motors Working Group. DOE 

further notes that OEM equipment can 

usually accommodate different models 

of motors and online cross-referencing 

tools 38 exist to help consumers identify 

motors that can be used as drop-in 

replacements. However, as discussed in 

section II.B.3 of this document, the 

Electric Motor Working group expressed 

that any efficiency requirements at or 

above EL 3, could result in market 

disruption and may not allow smaller 

size motor to remain on the market. 

Although DOE’s engineering analysis 

assumes that higher ELs can be reached 

without significant increase in size, 

DOE acknowledges that at or above EL 

3 (i.e., above the proposed TSL), some 

manufacturers may choose to rely on 

design options that would significantly 

increase the physical size of ESEMs and 

there is uncertainty as to whether the 

size, fit and function would be 

maintained at these levels. At or above 

EL3, this could result in a significant 

and widespread disruption to the OEM 

markets that used ESEMs as an 

embedded product, as those OEMs may 

have to make significant changes to 

their equipment that use ESEMs because 

those ESEMs could become larger in 

physical size. 

Regarding the additional OEM testing 

and certification costs, while DOE 

conducts a MIA to address the industry 

burden on the manufacturer of the 

considered covered equipment, DOE 

typically does not include the impacts 

to other manufacturers. The MIA for this 

rulemaking specifically examined the 

conversion costs that electric motor 

manufacturers (including OEMs that 

also manufacture electric motors) would 

incur due to the analyzed energy 

conservation standards for electric 

motors in comparison to the revenue 

and free cash electric motor 

manufacturers receive. The OEM testing 

and certification costs were not 

included in the MIA, and neither were 

the OEM revenues and free cash flows, 

as these costs and revenue are not 

specific to electric motor manufacturers. 

However, as noted by the Electric 

Motors Working Group, the proposed 

standards for ESEMs are not expected to 

cause broad market disruption. In 

addition, DOE fixed the frame size, 

which remained the same across 

efficiency levels. As such, the energy 

conservation standards proposed in this 

NOPR would preserve the frame sizes of 

electric motors on the market today. 

Further, as discussed in section IV.A.1 

of this document, ESEMs are built in 

standard NEMA frame sizes and are not 

common in currently regulated 

consumer products including those 

listed by AHAM and AHRI (i.e., clothes 

washers (top and front load), clothes 

dryers, food waste disposers, 

refrigerators, room air conditioners, and 

stick vacuums). Therefore, DOE believes 

the standards as proposed would not 

impact manufacturers of consumer 

products. In commercial equipment, 

DOE identified the following equipment 

as potentially incorporating ESEMs: 

walk-in coolers and freezers, circulator 

pumps, air circulating fans, and 

commercial unitary air conditioning 

equipment. If the proposed energy 

conservation standards for these rules 

finalize as proposed, DOE identified 

that these rules would all: (1) have a 

compliance year that is at or before the 

ESEM standard compliance year (2029) 

and/or (2) require a motor that is either 

outside of the scope of this rule (e.g., an 

ECM) or an ESEM with an efficiency 

above the proposed ESEM standards, 

and therefore not be impacted by the 

proposed ESEM rule (i.e., the ESEM rule 

would not trigger a redesign of these 

equipment). Therefore, DOE has 

tentatively determined that OEMs 

would already have to redesign these 

equipment to comply with these energy 

conservation standards, and the ESEM 

rule would not trigger another redesign 

of these equipment because the end-use 

equipment regulation would require 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87090 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

higher efficiency ESEMs or out of scope 

electric motors. Consequently, although 

DOE did not include any OEM testing 

and certification costs in this NOPR, 

DOE does not estimate these impacts to 

be significant. 

4. Cost-Efficiency Results 

The results of the engineering analysis 

are reported as cost-efficiency data (or 

‘‘curves’’) in the form of MSP (in 

dollars) versus full-load efficiency (in 

%), which form the basis for subsequent 

analysis. DOE developed ten curves 

representing the six equipment class 

groups. The methodology for developing 

the curves started with determining the 

full-load efficiency and MPCs for 

baseline motors. Above the baseline, 

DOE implemented various combinations 

of design options to achieve each 

efficiency level. Design options were 

implemented until all available 

technologies were employed (i.e., at a 

max-tech level). To account for 

manufacturers’ non-production costs 

and profit margin, DOE applies a 

manufacturer markup to the MPC, 

resulting in the MSP. See the following 

tables for the final results and chapter 

5 of the NOPR TSD for additional detail 

on the engineering analysis. 

5. Scaling Methodology 

Due to the large number of equipment 

classes, DOE was not able to perform a 

detailed engineering analysis on each 

one. Instead, DOE focused its analysis 

on the representative units and scaled 

the results to equipment classes not 

directly analyzed in the engineering 

analysis. In the March 2022 Preliminary 

Analysis, DOE used the current 

standards at 10 CFR 431.25 as a basis to 

scale the efficiency of the representative 

units to all other equipment classes. In 

order to scale for efficiency levels above 

baseline, the efficiencies for the 

representative units were shifted up or 

down by however many NEMA bands, 

because these bands are commonly used 

by industry when describing motor 

efficiency, that efficiency level was 

above current standards. DOE received 

a number of comments regarding scaling 

methodology, to which DOE responded 

to in the June 2023 DFR. 88 FR 36066, 

36099–36100. In that final rule, DOE 

determined that the approach used in 

the March 2022 Preliminary Analysis 

continued to be appropriate. Id. at 88 FR 

36100. DOE believes the rationale from 

its responses in the June 2023 DFR is 

applicable to this NOPR. 

In this NOPR, to scale across 

horsepower, pole configuration, and 

enclosure, DOE again relied on 

industry-recognized levels of efficiency 

when possible, or shifted forms of these 

levels. For example: when an efficiency 

level for a representative unit was 

NEMA Premium, Table 12–12 of NEMA 

MG 1–2016 was used to determine the 

efficiency of all the non-representative 

unit equipment classes. This method of 

scaling was also done for IE4 levels of 

efficiency, electric motor fire pump 

levels, and shifted versions of NEMA 

Premium (see section IV.C.1 of this 

document for a description of efficiency 

levels analyzed). DOE relied on 

industry-recognized levels because they 

sufficiently capture the effects of 

enclosure, pole configuration, frame 

size, and horsepower on motor 

efficiency. 

D. Markups Analysis 

The markups analysis develops 

appropriate markups (e.g., manufacturer 

markups, retailer markups, distributor 

markups, contractor markups) in the 

distribution chain and sales taxes to 

convert the MSP estimates derived in 

the engineering analysis to consumer 


ddrumheller on DSK120RN23PROD with PROPOSALS2EP15DE23.003</GPH> EP15DE23.004</GPH>
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87091 

39Because the projected price of standardscompliant equipment is typically higher than the 

price of baseline equipment, using the same markup 

for the incremental cost and the baseline cost would 

result in higher per-unit operating profit. While 

such an outcome is possible, DOE maintains that in 

markets that are reasonably competitive it is 

unlikely that standards would lead to a sustainable 

increase in profitability in the long run. 

40U. S. Census Bureau. 2019 Annual Survey of 

Manufactures (ASM): Statistics for Industry Groups 

and Industries. www.census.gov/programs-surveys/ 

asm.html (last accessed March 23, 2021). 

41Sales Tax Clearinghouse Inc. State Sales Tax 

Rates Along with Combined Average City and 

County Rates. July 2021. thestc.com/STrates.stm 

(last accessed July 1, 2021). 

42NEMA also provided the following link: 

www.regulations.gov/document/EERE-2015-BT-CE0019-0001. 

43Each five-digit code level NAICS includes 

several six-digit code level NAICS. 

44U.S. Department of Energy–Energy Information 

Administration, ‘‘2018 Commercial Buildings 

Energy Consumption Survey (CBECS),’’ 2018 

CBECS Survey Data, 2018, https://www.eia.gov/ 

consumption/commercial/data/2018/index.php?

view=methodology. 

45 2018 Manufacturing Energy Consumption 

Survey,’’ https://www.eia.gov/consumption/ 

manufacturing/data/2018/pdf/Table11_1.pdf. 

46Technical Support Document: Energy 

Efficiency Program for Consumer Products and 

Commercial and Industrial Equipment: Small 

Electric Motors Final Determination (Prepared for 

the Department of Energy by Staff Members of 

Navigant Consulting, Inc and Lawrence Berkeley 

National Laboratory, January 2021),’’ 

www.regulations.gov/document/EERE-2019-BTSTD-0008-0035. 

47Prakash Rao et al., ‘‘U.S. Industrial and 

Commercial Motor System Market Assessment 

Report Volume 1: Characteristics of the Installed 

Base,’’ January 12, 2021, doi.org/10.2172/1760267. 

prices, which are then used in the LCC 

and PBP analysis and in the 

manufacturer impact analysis. At each 

step in the distribution channel, 

companies mark up the price of the 

equipment to cover business costs and 

profit margin. 

In the March 2022 Preliminary 

Analysis, DOE identified distribution 

channels for electric motors and their 

respective market shares (i.e., 

percentage of sales going through each 

channel). For ESEMs, the main parties 

in the distribution chain are OEMs, 

equipment or motor wholesalers, 

retailers, and contractors. See section 

6.2 of the March 2022 Preliminary TSD. 

DOE did not receive any comment on 

the distribution channels identified in 

response to the March 2022 Preliminary 

Analysis. DOE retained these 

distribution channels for this NOPR. 

DOE developed baseline and 

incremental markups for each actor in 

the distribution chain. Baseline 

markups are applied to the price of 

equipment with baseline efficiency, 

while incremental markups are applied 

to the difference in price between 

baseline and higher-efficiency models 

(the incremental cost increase). The 

incremental markup is typically less 

than the baseline markup and is 

designed to maintain similar per-unit 

operating profit before and after new or 

amended standards.39

In the March 2022 Preliminary 

Analysis, DOE relied on economic data 

from the U.S. Census Bureau and on 

2020 RS Means Electrical Cost Data to 

estimate average baseline and 

incremental markups. Specifically, DOE 

estimated the OEM markups for electric 

motors based on financial data of 

different sets of OEMs that use 

respective electric motors from the latest 

2019 Annual Survey of Manufactures.40

The relevant sets of OEMs identified 

were listed in Table 6.4.2 of the March 

2022 Preliminary TSD, using six-digit 

code level North American Industry 

Classification System (‘‘NAICS’’). 

Further, DOE collected information 

regarding sales taxes from the Sales Tax 

Clearinghouse.41

In response to the March 2022 

Preliminary Analysis, NEMA agreed 

that 95 percent of ESEMs reach the 

market through the OEM equipment 

channel. NEMA further commented that 

Table 6.4.2 of the March 2022 

Preliminary TSD should be replaced by 

Table IV.3 of the Import Data 

Declaration Proposed Rule.42 (NEMA, 

No. 22 at p. 18) Table IV.3 of the Import 

Data Declaration Proposed Rule 

provides a list of five-digit code level 

NAICS.43 DOE reviewed the 

corresponding six-digit code level 

NAICS and identified the following 

additional OEM as relevant in the 

context of OEMs incorporating ESEMs 

in their equipment: 333991 ‘‘Powerdriven handtool manufacturing;’’ 

333999 ‘‘All other miscellaneous 

general Purpose machinery 

manufacturing;’’ 335210 ‘‘Small 

electrical appliance manufacturing;’’ 

and 335220 ‘‘Major appliance 

manufacturing’’. Other NAICS codes 

were either already included in the 

March 2022 Preliminary Analysis or did 

not correspond to OEMs incorporating 

ESEMs in their equipment. 

For this NOPR, DOE revised the OEM 

baseline and incremental markups 

calculation to account for these 

additional NAICS codes. In addition, 

DOE relied on updated data from the 

economic data from the U.S. Census 

Bureau, 2023 RS Means Electrical Cost 

Data, and the updated data from the 

Sales Tax Clearinghouse. 

Chapter 6 of the NOPR TSD provides 

details on DOE’s development of 

markups for ESEMs. 

DOE requests data and information to 

characterize the distribution channels 

for ESEMs and associated market shares. 

E. Energy Use Analysis 

The purpose of the energy use 

analysis is to determine the annual 

energy consumption of ESEMs at 

different efficiencies for a representative 

sample of residential, commercial, and 

industrial consumers, and to assess the 

energy savings potential of increased 

ESEM efficiency. The energy use 

analysis estimates the range of energy 

use of ESEMs in the field (i.e., as they 

are actually used by consumers). For 

each consumer in the sample, the 

energy use is calculated by multiplying 

the annual average motor input power 

by the annual operating hours. The 

energy use analysis provides the basis 

for other analyses DOE performed, 

particularly assessments of the energy 

savings and the savings in consumer 

operating costs that could result from 

adoption of new standards. 

1. Consumer Sample 

DOE created a consumer sample to 

represent consumers of electric motors 

in the commercial, industrial, and 

residential sectors. DOE used the 

sample to determine electric motor 

annual energy consumption as well as 

to conduct the LCC and PBP analyses. 

Each consumer in the sample was 

assigned a sector, an application, and a 

region. The sector and application 

determine the usage profile of the 

electric motor and the economic 

characteristics of the motor owner vary 

by sector and region. In addition, 

residential consumers were assigned 

household income groups. In the March 

2022 Preliminary Analysis, DOE 

primarily relied on data from the 2018 

Commercial Building Energy 

Consumption Survey (‘‘CBECS’’),44 the 

2018 Manufacturing Energy 

Consumption Survey (‘‘MECS’’),45 the 

2015 Residential Energy Consumption 

Survey (‘‘RECS’’), a previous DOE 

Technical Support Document (‘‘January 

2021 Final Determination Technical 

Support Document’’) related to small 

electric motors,46 and a DOE–AMO 

report ‘‘U.S. Industrial and Commercial 

Motor System Market Assessment 

Report Volume 1: Characteristics of the 

Installed Base’’ (‘‘MSMA’’ or ‘‘DOE– 

AMO report’’).47 See chapter 7 of the 

March 2022 Preliminary TSD. 

Specifically, in the March 2022 

Preliminary Analysis, for ESEMs, DOE 

used information from the Small 

Electric Motors January 2021 Final 

Determination Technical Support 

Document to develop sector specific 

distributions. Since the publication of 

the March 2022 Preliminary Analysis, 

DOE updated the consumer sample to 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87092 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

48 ‘‘2020 Residential Energy Consumption Survey 

Data,’’, https://www.eia.gov/consumption/ 

residential/data/2020/https://www.eia.gov/ 

consumption/residential/data/2020/ (last accessed 

July 5, 2023). 

49 Goetzler, William, Sutherland, Timothy, and 

Reis, Callie. Energy Savings Potential and 

Opportunities for High-Efficiency Electric Motors in 

Residential and Commercial Equipment. United 

States: N. p., 2013. Web. doi:10.2172/1220812. 

Available at: osti.gov/biblio/1220812 (last accessed 

April 18, 2023). 

50 ‘‘EuP–LOT–30-Task-7-Jun-2014.Pdf,’’ Available 

at www.eup-network.de/fileadmin/user_upload/ 

EuP-LOT-30-Task-7-Jun-2014.pdf (last accessed 

April 26, 2021). The European motor study 

estimated, as a ‘‘worst case scenario,’’ that up to 40 

percent of consumers purchasing motors for 

replacement applications may not see any decrease 

or increase in energy use due to this impact and did 

not incorporate any change in energy use with 

increased speed. In addition, the European motor 

study also predicts that any energy use impact will 

be reduced over time because new motor driven 

equipment would be designed to take account of 

this change in speed. Therefore, the study did not 

incorporate this effect in the analysis (i.e., 0 percent 

of negatively impacted consumers). In the absence 

of additional data to estimate the percentage of 

consumers that may be negatively impacted in the 

compliance year, DOE relied on the mid-point value 

of 20 percent. 

reflect the latest version of RECS (i.e., 

2020 RECS).48 DOE also revised the 

distribution of ESEMs by sector to 

reflect that the majority of single-phase 

motors are used in the residential and 

commercial sectors 49 and incorporate 

the industrial and commercial sector 

distributions as published in the June 

2023 DFR. 

In response to DOE’s requests for 

feedback regarding consumer sample in 

the March 2022 Preliminary Analysis, 

NEMA referred DOE to the MSMA 

report (NEMA, No. 22 at p. 19) As 

previously described, DOE relied on 

information from the MSMA report to 

inform its consumer sample. DOE did 

not receive any additional comments 

related to the consumer sample 

developed in the March 2022 

Preliminary Analysis and, in this NOPR, 

DOE continued to rely on the MSMA 

report to characterize motor use in the 

commercial and industrial sectors. 

DOE requests data and information to 

characterize the distribution of ESEMs 

by sector (commercial, industrial, and 

residential sectors) as well as the 

distribution of ESEMs by application in 

each sector. 

2. Motor Input Power

In the March 2022 Preliminary

Analysis, DOE calculated the motor 

input power as the sum of (1) the 

electric motor’s rated horsepower 

multiplied by its operating load (i.e., the 

motor output power), and (2) the losses 

at the operating load (i.e., part-load 

losses). DOE estimated distributions of 

motor average annual operating load by 

application and sector based on 

information from the MSMA report. 

DOE determined the part-load losses 

using outputs from the engineering 

analysis (full-load efficiency at each 

efficiency level) and published part-load 

efficiency information from 2016 and 

2020 catalog data from several 

manufacturers to model motor part-load 

losses as a function of the motor’s 

operating load. See section 7.2.2 of the 

March 2022 Preliminary TSD. 

In response to DOE’s requests for 

feedback regarding distributions of 

average annual operating load by 

application and sector in the March 

2022 Preliminary Analysis, NEMA 

referred DOE to the MSMA report. 

(NEMA, No. 22 at p. 19) As previously 

described, DOE relied on information 

from the MSMA report to characterize 

average annual operating loads. DOE 

did not receive any additional 

comments related to the distributions of 

operating loads developed in the March 

2022 Preliminary Analysis and retained 

the same approach for this NOPR. 

DOE did not receive any comments on 

its approach to determine part-load 

losses and retained the same 

methodology for this NOPR. However, 

DOE updated its analysis to account for 

more recent part-load efficiency 

information from 2022 manufacturer 

catalogs. 

DOE seeks data and additional 

information to characterize ESEM 

operating loads. 

3. Annual Operating Hours

In the March 2022 Preliminary

Analysis, DOE used information from 

the MSMA report to establish 

distributions of motor annual hours of 

operation by application for the 

commercial and industrial sectors. See 

section 7.2.5 of the March 2022 

Preliminary TSD. The MSMA report 

provided average, mean, median, 

minimum, maximum, and quartile 

boundaries for annual operating hours 

across industrial and commercial 

sectors by application and showed no 

significant difference in average annual 

hours of operation between horsepower 

ranges. DOE used this information to 

develop application-specific statistical 

distributions of annual operating hours 

in the commercial and industrial 

sectors. 

For electric motors used in the 

agricultural sector (which were not 

included in the MSMA report), DOE 

derived statistical distributions of 

annual operating hours of irrigation 

pumps by region using data from the 

2013 Census of Agriculture Farm and 

Ranch Irrigation Survey. 

For ESEMs used in the residential 

sector (which is a sector that was not 

studied in the MSMA report), DOE did 

not receive any comments specific to 

the residential sector. DOE retained the 

approach used in the March 2022 

Preliminary Analysis and relied on the 

distributions of operating hours by 

application as presented in chapter 7 of 

the January 2021 Final Determination 

Technical Support Document pertaining 

to SEMs. 

In response to DOE’s requests for 

feedback regarding distributions of 

average annual operating hours by 

application and sector in the March 

2022 Preliminary Analysis, NEMA 

referred DOE to the MSMA report. 

(NEMA, No. 22 at p. 20) As previously 

described, DOE relied on information 

from the MSMA report to inform its 

distributions of annual operating hours 

in the commercial and industrial 

sectors. For other sectors not included 

in the MSMA report, DOE relied on 

additional data sources as previously 

described. DOE did not receive any 

additional comments related to the 

distributions of operating hours 

developed in the March 2022 

Preliminary Analysis and retained the 

same approach for this NOPR. 

DOE requests comment on the 

distribution of average annual operating 

hours by application and sector used to 

characterize the variability in energy use 

for ESEMs. 

4. Impact of Electric Motor Speed

Any increase in operating speeds as

the efficiency of the motor is increased 

could affect the energy saving benefits 

of more efficient motors in certain 

variable torque applications (i.e., fans, 

pumps, and compressors) due to the 

cubic relation between speed and power 

requirements (i.e., ‘‘affinity law’’). In the 

March 2022 Preliminary Analysis, DOE 

accounted for any changes in the 

motor’s rated speed with an increase in 

efficiency levels, for those electric 

motors that are currently regulated 

under 10 CFR 431.25 and for AO–MEMs 

and for which the engineering analysis 

provided speed information by EL. 

Based on information from a European 

motor study,50 DOE assumed that 20 

percent of consumers with fan, pump, 

and air compressor applications would 

be negatively impacted by higher 

operating speeds. For other electric 

motor categories that it analyzed in the 

March 2022 Preliminary Analysis, 

including ESEMs, DOE did not 

characterize the motor speed by ELs as 

part of the engineering analysis and 

DOE did not include this impact in the 

analysis. See section 7.2.2.1 of the 

March 2022 Preliminary TSD. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87093 

51The motor slip is the difference between the 

motor’s synchronous speed and actual speed which 

is lower than the synchronous speed). At higher 

ELs, the speed of a given motor may increase and 

the motor slip may decrease. 

52 DOE did not have data specific to pumps 

driven by ESEMs and relied on pump, fans, and 

compressor applications driven by the broader 

category of electric motors. 

53See Figure 64 and Figure 71 of the MSMA 

report. 

54See 2016 Fan Notice of Data Availability, 81 FR 

75742 (Nov. 1, 2016); LCC spreadsheet, ‘‘LCC 

sample’’ worksheet, ‘‘Belt vs. direct driven fan 

distribution’’ available at www.regulations.gov/ 

document/EERE-2013-BT-STD-0006-0190. 

In response to the March 2022 

Preliminary Analysis, the Joint 

Advocates requested clarifications 

regarding how DOE accounted for the 

impact of the increase motor speed on 

the energy use, as well as how motor 

slip was incorporated into the energy 

use analysis. (Joint Advocates, No. 27 at 

pp. 4–5) 51

DOE described the method and 

assumptions used to calculate the 

impact of higher speed on energy use in 

section 7.2.2.1 of the March 2022 

Preliminary TSD. In this NOPR, DOE 

provided additional details on the 

methodology and equations used as part 

of Appendix 7A in the NOPR TSD. 

NEMA commented that nearly 100 

percent of fans, pumps and compressors 

using ESEMs would be negatively 

impacted by an increase in speed. In 

addition, NEMA commented that it 

would take up to two years for OEMs to 

redesign and recertify an equipment 

with a motor that has higher speed and 

provided an example calculation to 

illustrate the impacts of higher speed 

operation. (NEMA, No. 22 at pp. 20–21, 

49) 

The Joint Industry Stakeholders 

commented that DOE should consider 

the full impact of higher speed motors 

by considering new products as well as 

replacement. The Joint Industry 

Stakeholders added that DOE only 

incorporated the effect of increased 

speeds in currently regulated motors 

and air-over motors and that this effect 

should also be accounted for in ESEMs. 

The Joint Industry Stakeholders 

commented that if lower speed motors 

are no longer available, appliances may 

be forced to incorporate higher speed 

motors, which may cause short-cycling 

in HVAC and refrigeration applications 

and result in negative impacts in other 

appliances. (Joint Industry Stakeholders, 

No. 23 at pp. 8–9) 

In this NOPR, DOE included the effect 

of increased speeds in the energy use 

calculation for all equipment classes. 

DOE reviewed information related to 

pump, fans, and compressor 

applications driven by electric motors 52

and notes that in the commercial land 

industrial sectors: (1) 7 to 20 percent of 

motors used in these applications are 

paired with VFDs, which allow the user 

to adjust the speed of the motor; 53 (2) 

approximately half of fans operate with 

belts, which also allow the user to 

adjust the speed of the driven fan; 54 (3) 

some applications would benefit from 

increase in speeds as the work would be 

completed at a higher load in less 

operating hours (e.g., pump filling water 

tank faster at increased speed); and (4) 

not all fans, pumps and compressors are 

variable torque loads to which the 

affinity laws applies. Therefore, less 

than 100 percent of motor in these 

applications would experience an 

increase in energy use as a result of an 

increase in speed. In addition, as 

described in the European motor study, 

the increase in speed would primarily 

impact replacement motors installed in 

applications that previously operated 

with a lower speed motor. For these 

reasons, DOE has determined that 

assuming that 100 percent of fans, 

pumps and compressors using ESEM 

would be negatively impacted by an 

increase in speed would not be 

representative. DOE continues to rely on 

a 20 percent assumption used in the 

March 2022 Preliminary Analysis, based 

on the European motor study. In 

addition, DOE incorporated a sensitivity 

analysis allowing the user to consider 

this effect for three additional scenarios 

described in appendix 7–A of the NOPR 

TSD (i.e., 0 percent, 50 percent and 100 

percent). 

Chapter 7 of the NOPR TSD provides 

details on DOE’s energy use analysis for 

ESEMs. 

DOE seeks data and additional 

information to support the analysis of 

projected energy use impacts related to 

any increases in motor nominal speed. 

F. Life-Cycle Cost and Payback Period 

Analysis 

DOE conducted LCC and PBP 

analyses to evaluate the economic 

impacts on individual consumers of 

potential energy conservation standards 

for ESEMs. The effect of new energy 

conservation standards on individual 

consumers usually involves a reduction 

in operating cost and an increase in 

purchase cost. DOE used the following 

two metrics to measure consumer 

impacts: 

b The LCC is the total consumer 

expense of an equipment over the life of 

that equipment, consisting of total 

installed cost (manufacturer selling 

price, distribution chain markups, sales 

tax, and installation costs) plus 

operating costs (expenses for energy use, 

maintenance, and repair). To compute 

the operating costs, DOE discounts 

future operating costs to the time of 

purchase and sums them over the 

lifetime of the equipment. 

b The PBP is the estimated amount 

of time (in years) it takes consumers to 

recover the increased purchase cost 

(including installation) of a moreefficient equipment through lower 

operating costs. DOE calculates the PBP 

by dividing the change in purchase cost 

at higher efficiency levels by the change 

in annual operating cost for the year that 

new standards are assumed to take 

effect. 

For any given efficiency level, DOE 

measures the change in LCC relative to 

the LCC in the no-new-standards case, 

which reflects the estimated efficiency 

distribution of ESEMs in the absence of 

new energy conservation standards. In 

contrast, the PBP for a given efficiency 

level is measured relative to the baseline 

equipment. 

For each considered efficiency level 

in each equipment class, DOE 

calculated the LCC and PBP for a 

nationally representative set of 

consumers. As stated previously, DOE 

developed consumer samples from 

various data sources (see section IV.E.1 

of this document). For each sample 

consumer, DOE determined the energy 

consumption for the ESEM and the 

appropriate energy price. By developing 

a representative sample of consumers, 

the analysis captured the variability in 

energy consumption and energy prices 

associated with the use of ESEMs. 

Inputs to the calculation of total 

installed cost include the cost of the 

equipment—which includes MPCs, 

manufacturer markups, retailer and 

distributor markups, and sales taxes— 

and installation costs. Inputs to the 

calculation of operating expenses 

include annual energy consumption, 

energy prices and price projections, 

repair and maintenance costs, 

equipment lifetimes, and discount rates. 

DOE created distributions of values for 

equipment lifetime, discount rates, and 

sales taxes, with probabilities attached 

to each value, to account for their 

uncertainty and variability. 

The computer model DOE uses to 

calculate the LCC relies on a Monte 

Carlo simulation to incorporate 

uncertainty and variability into the 

analysis. The Monte Carlo simulations 

randomly sample input values from the 

probability distributions and ESEM 

consumer samples. The model 

calculated the LCC for equipment at 

each efficiency level for 10,000 

consumers per simulation run. The 

analytical results include a distribution 

of 10,000 data points showing the range 

of LCC savings for a given efficiency 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87094 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

55U.S. DOE Building technology Office, Energy 

Savings Potential and Opportunities for HighEfficiency Electric Motors in residential and 

Commercial Equipment, December 2013. Available 

at: www.energy.gov/eere/buildings/downloads/ 

motor-energy-savings-potential-report. 

56See, for example, Nidec and ABB: http://

acim.nidec.com/motors/usmotors/industryapplications/hvac;bit.ly/3wEIQyu. 

57As discussed in section IV.E.4 of this 

document, DOE acknowledges that in some cases 

higher efficiency motors may operate at higher 

speeds which could offset some of the expected 

energy savings. 

level relative to the no-new-standards 

case efficiency distribution. In 

performing an iteration of the Monte 

Carlo simulation for a given consumer, 

equipment efficiency is chosen based on 

its probability. If the chosen equipment 

efficiency is greater than or equal to the 

efficiency of the standard level under 

consideration, the LCC calculation 

reveals that a consumer is not impacted 

by the standard level. By accounting for 

consumers who already purchase moreefficient equipment, DOE avoids 

overstating the potential benefits from 

increasing equipment efficiency. DOE 

calculated the LCC and PBP for 

consumers of ESEMs as if each were to 

purchase a new equipment in the first 

year of required compliance with new 

standards. DOE used 2029 as the first 

year of compliance with any new 

standards for ESEMs as discussed in 

section II.B.3 of this document. 

Table IV–7 summarizes the approach 

and data DOE used to derive inputs to 

the LCC and PBP calculations. The 

subsections that follow provide further 

discussion. Details of the spreadsheet 

model, and of all the inputs to the LCC 

and PBP analyses, are contained in 

chapter 8 of the NOPR TSD and its 

appendices. 

TABLE IV–7—SUMMARY OF INPUTS AND METHODS FOR THE LCC AND PBP ANALYSIS * 

Inputs Source/method 

Equipment Cost .............................. Derived by multiplying MPCs by manufacturer and retailer markups and sales tax, as appropriate. Used a 

constant price trend to project equipment costs based on historical data. 

Installation Costs ............................. Assumed no change with efficiency level other than shipping costs. 

Annual Energy Use ......................... Motor input power multiplied by annual operating hours per year. 

Variability: Primarily based on the MSMA report, 2018 CBECS, 2018 MECS, and 2020 RECS. 

Energy Prices .................................. Electricity: Based on EEI Typical Bills and Average Rates Reports data for 2022. 

Variability: Regional energy prices determined for four census regions. 

Energy Price Trends ....................... Based on AEO2023 price projections. 

Repair and Maintenance Costs ...... Assumed ESEMs are not repaired. 

Assumed no change in maintenance costs with efficiency level. 

Equipment Lifetime ......................... Average: 7.1 years (6.8 to 9.3 years depending on the equipment class group and horsepower considered). 

Discount Rates ................................ Residential: Approach involves identifying all possible debt or asset classes that might be used to purchase the considered appliances, or might be affected indirectly. Primary data source was the Federal 

Reserve Board’s Survey of Consumer Finances. 

Non-residential: Calculated as the weighted average cost of capital for entities purchasing electric motors. 

Primary data source was Damodaran Online. 

Compliance Date ............................ 2029. 

* Not used for PBP calculation. References for the data sources mentioned in this table are provided in the sections following the table or in 

chapter 8 of the NOPR TSD. 

In response to the March 2022 

Preliminary Analysis, the Joint Industry 

Stakeholders commented that doubleregulation has no corresponding 

consumer benefits in the form of 

reduced power consumption given the 

appliance regulations being unchanged 

and the fact that a more efficient motor 

does not necessarily translate to a more 

efficient product when incorporated 

into a finished good. The Joint Industry 

Stakeholders commented that to 

potentially increase the cost of an OEM 

product, without a corresponding 

energy savings, would mean a net loss 

for consumers and negative national 

impacts. The Joint Industry 

Stakeholders noted that the DOE used 

operating hours for the following 

categories of equipment: air 

compressors, refrigeration compressors, 

fans and blowers, pumps material 

handling, material processing, other, 

and agricultural pumps. Of these, the 

Joint Industry Stakeholders noted that 

electric motors used in air compressors, 

refrigeration compressors, fans and 

blowers, pumps and agricultural pumps 

are already regulated to some extent and 

that DOE made no apparent effort to 

account for this and deduct a significant 

portion of those estimated hours. (Joint 

Industry Stakeholders, No. 23 at p. 5) 

AHAM and AHRI commented that 

expanding coverage to special and 

definite purpose motors would force 

manufacturers to incorporate more 

expensive motors and increase the cost 

of appliances and equipment, while not 

necessarily improving the energy 

performance of the finished product 

(whether it be a covered product/ 

equipment or not). (AHAM and AHRI, 

No. 25 at p. 9) Lennox commented that 

DOE must accurately assess, and avoid 

double-counting, energy savings when 

assessing potential efficiency 

improvements from motors used in 

already-regulated HVAC equipment. 

Lennox commented that it is unclear in 

the LCC and PBP analysis if DOE 

accounted for double regulation and 

eliminated energy savings already 

achieved from system-level HVACR 

regulation. (Lennox, No. 29 at p. 4) HI 

commented that there is a potential for 

duplicate accounting of energy savings 

when regulating motors in general. HI 

stated that, in addition to the ESEMs, 

there is a potential for other motor 

product efficiencies to be counted twice 

such as the use of inverter-only 

products in pumps when the DOE 

calculates savings in their evaluations 

(one for inverter only motors, and 

another for pumps using those motors). 

(HI, No. 31 at p. 1) 

As highlighted in a previous DOE 

report, motor energy savings potential 

and opportunities for higher efficiency 

electric motors in commercial and 

residential equipment would result in 

overall energy savings.55 In addition, 

some manufacturers advertise electric 

motors as resulting in energy savings in 

HVAC equipment.56 All other 

characteristics of the equipment and 

motor being held constant, increasing 

the efficiency of the motor component 

will increase the efficiency of the 

overall equipment.57 Therefore, DOE 

disagrees with the Joint Industry 

Stakeholders that an increase in motor 

efficiency would not result in a more 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87095 

58Series ID PCU3353123353123 and 

PCU3353123353121 for integral and fractional 

horsepower motors and generators manufacturing, 

respectively; www.bls.gov/ppi/. 

59Coughlin, K. and B. Beraki.2018. Residential 

Electricity Prices: A Review of Data Sources and 

Estimation Methods. Lawrence Berkeley National 

Lab. Berkeley, CA. Report No. LBNL–2001169. 

https://ees.lbl.gov/publications/residentialelectricity-prices-review. 

60Coughlin, K. and B. Beraki. 2019. Nonresidential Electricity Prices: A Review of Data 

Sources and Estimation Methods. Lawrence 

Berkeley National Lab. Berkeley, CA. Report No. 

LBNL–2001203. https://ees.lbl.gov/publications/ 

non-residential-electricity-prices. 

61Energy Information Administration. Annual 

Energy Outlook 2023. Available at www.eia.gov/ 

outlooks/aeo/ (last accessed May 1, 2023). 

efficient equipment when incorporated 

into a given equipment. In addition, 

DOE’s analysis ensures the LCC and 

NIA analysis do not result in doublecounting of energy savings by 

accounting for consumers who already 

purchase more-efficient products and 

calculating LCC and energy savings 

relative to a no-new standards case 

efficiency distribution. See section 

IV.F.8 of this document. Finally, any 

future analysis in support of energy 

conservation standards for equipment 

incorporating motors would also 

account for equipment that already 

incorporate more-efficient electric 

motors and would not result in any 

double counting of energy savings 

resulting from motor efficiency 

improvements. 

1. Equipment Cost 

To calculate consumer equipment 

costs, DOE multiplied the MSPs 

developed in the engineering analysis 

by the distribution channel markups 

described previously (along with sales 

taxes). DOE used different markups for 

baseline equipment and higherefficiency equipment, because DOE 

applies an incremental markup to the 

increase in MSP associated with higherefficiency equipment. 

To project an equipment price trend 

for electric motors, DOE obtained 

historical Producer Price Index (‘‘PPI’’) 

data for integral horsepower motors and 

generators manufacturing spanning the 

time period 1969–2022 and for 

fractional horsepower motors and 

generators manufacturing between 

1967–2022 from the Bureau of Labor 

Statistics (‘‘BLS’’).58 The PPI data reflect 

nominal prices, adjusted for electric 

motor quality changes. An inflationadjusted (deflated) price index for 

integral and fractional horsepower 

motors and generators manufacturing 

was calculated by dividing the PPI 

series by the implicit price deflator for 

Gross Domestic Product. The deflated 

price index for integral horsepower 

motors was found to align with the 

copper, steel and aluminum deflated 

price indices. DOE believes that the 

extent to how these trends will continue 

in the future is very uncertain. In 

addition, the deflated price index for 

fractional horsepower motors was 

mostly flat during the entire period from 

1967 to 2022. Therefore, DOE relied on 

a constant price assumption as the 

default price factor index to project 

future electric motor prices. 

DOE did not receive any comments on 

price trends in response to the March 

2022 Preliminary Analysis and retained 

the same approach in this NOPR. 

DOE requests data and information 

regarding the most appropriate price 

trend to use to project ESEM prices. 

2. Installation Cost 

Installation cost includes labor, 

overhead, and any miscellaneous 

materials and parts needed to install the 

equipment. Electric motor installation 

cost data from 2023 RS Means Electrical 

Cost Data show a variation in 

installation costs according to the motor 

horsepower (for three-phase electric 

motors), but not according to efficiency. 

DOE found no evidence that installation 

costs would be impacted with increased 

efficiency levels. Therefore, in the 

March 2022 Preliminary Analysis, DOE 

did not incorporate changes in 

installation costs for motors that are 

more efficient than baseline equipment. 

DOE assumed there is no variation in 

installation costs between a baseline 

efficiency motor and a higher efficiency 

motor except in terms of shipping costs. 

These shipping costs were based on 

weight data from the engineering 

analysis for the representative units. See 

section 8.2.4 of the March 2022 

Preliminary Analysis. 

In response to the March 2022 

Preliminary Analysis, EASA 

commented that if a motor is replaced 

with a physically larger frame, the 

replacement would have higher 

installation costs because of the added 

complexity of modifying the mounting 

setup to accommodate the larger motor, 

and in some case would be impossible. 

(EASA, No. 21 at pp. 2–3) 

As noted in section IV.C.1.c of this 

document, DOE fixed the frame size, 

which remains the same across 

efficiency levels in the analysis. 

Therefore, DOE did not account for any 

changes in installation costs due to 

changes in frame sizes and, in this 

NOPR, DOE retained the approach used 

in the March 2022 Preliminary Analysis 

and assumed there is no variation in 

installation costs between a baseline 

efficiency motor and a higher efficiency 

motor except in terms of shipping costs. 

DOE requests comment on whether 

any of the efficiency levels considered 

in this NOPR might lead to an increase 

in installation costs, and if so, DOE 

seeks supporting data regarding the 

magnitude of the increased cost per unit 

for each relevant efficiency level and the 

reasons for those differences. 

3. Annual Energy Consumption 

For each sampled consumer, DOE 

determined the energy consumption for 

an electric motor at different efficiency 

levels using the approach described 

previously in section IV.E of this 

document. 

4. Energy Prices 

Because marginal electricity price 

more accurately captures the 

incremental savings associated with a 

change in energy use from higher 

efficiency, it provides a better 

representation of incremental change in 

consumer costs than average electricity 

prices. Therefore, DOE applied average 

electricity prices for the energy use of 

the equipment purchased in the nonew-standards case, and marginal 

electricity prices for the incremental 

change in energy use associated with 

the other efficiency levels considered. 

DOE derived electricity prices in 2022 

using data from EEI Typical Bills and 

Average Rates reports. Based upon 

comprehensive, industry-wide surveys, 

this semi-annual report presents typical 

monthly electric bills and average 

kilowatt-hour costs to the customer as 

charged by investor-owned utilities. For 

the residential sector, DOE calculated 

electricity prices using the methodology 

described in Coughlin and Beraki 

(2018).59 For the non-residential sectors, 

DOE calculated electricity prices using 

the methodology described in Coughlin 

and Beraki (2019).60

DOE’s methodology allows electricity 

prices to vary by sector, region and 

season. In the analysis, variability in 

electricity prices is chosen to be 

consistent with the way the consumer 

economic and energy use characteristics 

are defined in the LCC analysis. For 

electric motors, DOE relied on 

variability by region and sector. See 

chapter 8 of the NOPR TSD for more 

details. 

To estimate energy prices in future 

years, DOE multiplied the 2022 energy 

prices by the projection of annual 

average price changes for each of the 

nine census divisions from the 

Reference case in AEO2023, which has 

an end year of 2050.61 To estimate price 

trends after 2050, the 2050 prices were 

held constant. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87096 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

62The implicit discount rate is inferred from a 

consumer purchase decision between two otherwise 

identical goods with different first cost and 

operating cost. It is the interest rate that equates the 

increment of first cost to the difference in net 

present value of lifetime operating cost, 

incorporating the influence of several factors: 

transaction costs; risk premiums and response to 

uncertainty; time preferences; interest rates at 

which a consumer is able to borrow or lend. The 

implicit discount rate is not appropriate for the LCC 

analysis because it reflects a range of factors that 

influence consumer purchase decisions, rather than 

the opportunity cost of the funds that are used in 

purchases. 63Federal Reserve Board. Survey of Consumer 

Finances (SCF) for 1995, 1998, 2001, 2004, 2007, 

2010, 2013, 2016, and 2019. 64 Damodaran, A. Data Page: Historical Returns 

on Stocks, Bonds and Bills—United States. 2021. 

pages.stern.nyu.edu/∼adamodar/ (last accessed 

April 26, 2022). 

5. Maintenance and Repair Costs 

Repair costs are associated with 

repairing or replacing equipment 

components that have failed in an 

equipment; maintenance costs are 

associated with maintaining the 

operation of the equipment. 

In the March 2022 Preliminary 

Analysis, for the maintenance costs, 

DOE did not find data indicating a 

variation in maintenance costs between 

baseline efficiency and higher efficiency 

motors. The cost of replacing bearings, 

which is the most common maintenance 

practice, is constant across efficiency 

levels. Therefore, DOE did not include 

maintenance costs in the LCC analysis. 

See Section 8.3.3 of the March 2022 

Preliminary Analysis. 

DOE did not receive any comments 

related to maintenance costs and 

retained the same approach in this 

NOPR. 

DOE considers a motor repair as 

including rewinding and 

reconditioning. See section 8.3.3 of the 

March 2022 Preliminary Analysis TSD. 

In the March 2022 Preliminary Analysis, 

DOE only included repair costs for units 

with a horsepower greater than 20 

horsepower and did not consider any 

repair for the ESEM representative 

units. See section 8.3.3 of the March 

2022 Preliminary Analysis. 

In response to the March 2022 

Preliminary Analysis, EASA 

commented that the definition of repair 

must be clear for the purposes of 

estimating the number of repairs and 

should be provided in a separate 

‘‘Definitions’’ section. (EASA, No. 21 at 

p. 5) As noted previously, DOE 

considers a motor repair as including 

rewinding and reconditioning and 

describes the term in chapter 8 of the 

NOPR TSD (this was also described in 

chapter 8 of the March 2022 Preliminary 

Analysis). Other non-rewinding related 

practices, such as bearing replacement, 

were considered as part of the 

maintenance costs. 

DOE did not receive any comments 

supporting inclusion of repair costs for 

ESEMs and, in this NOPR, continued to 

exclude repair costs for ESEMs in line 

with the approach used in the March 

2022 Preliminary Analysis. 

DOE requests comment on whether 

any of the efficiency levels considered 

in this NOPR might lead to an increase 

in maintenance and repair costs, and if 

so, DOE seeks supporting data regarding 

the magnitude of the increased cost per 

unit for each relevant efficiency level 

and the reasons for those differences. 

6. Equipment Lifetime 

In the March 2022 Preliminary 

Analysis, DOE established separate 

average mechanical lifetime estimates 

for single phase and polyphase ESEMs 

and AO–ESEMs. DOE then developed 

Weibull distributions of mechanical 

lifetimes (in hours). The lifetime in 

years for a sampled electric motor is 

calculated by dividing the sampled 

mechanical lifetime by the sampled 

annual operating hours of the electric 

motor. In addition, DOE considered that 

ESEMs and AO–ESEMs are typically 

embedded in a piece of equipment (i.e., 

an application). For such applications, 

DOE developed Weibull distributions of 

application lifetimes expressed in years 

and compared the sampled motor 

mechanical lifetime (in years) with the 

sampled application lifetime. DOE 

assumed that the electric motor would 

be retired at the earlier of the two ages. 

See section 8.3.4 of the March 2022 

Preliminary Analysis. 

In response to the March 2022 

Preliminary Analysis, EASA 

commented that the definition of 

lifetime must be clear and should be 

provided in a separate ‘‘Definitions’’ 

section. (EASA, No. 21 at p. 5) In 

response, DOE notes that it considers a 

motor lifetime as the age at which an 

equipment is retired from service and 

describes the term in chapter 8 of the 

NOPR TSD (this was also described in 

chapter 8 of the March 2022 Preliminary 

Analysis). 

DOE did not receive any comments 

regarding ESEMs and AO–ESEMs 

lifetimes and continued to apply the 

same approach in this NOPR as in the 

March 2022 Preliminary Analysis. 

DOE requests comment on the 

equipment lifetimes (both in years and 

in mechanical hours) used for each 

representative unit considered in the 

LCC and PBP analyses. 

7. Discount Rates 

In the calculation of LCC, DOE 

applies discount rates appropriate to 

consumers to estimate the present value 

of future operating cost savings. DOE 

estimated a distribution of sectorspecific discount rates for ESEMs based 

on the opportunity cost of consumer 

funds. 

DOE applies weighted average 

discount rates calculated from consumer 

debt and asset data, rather than marginal 

or implicit discount rates.62 The LCC 

analysis estimates net present value 

over the lifetime of the equipment, so 

the appropriate discount rate will reflect 

the general opportunity cost of 

consumer funds, taking this time scale 

into account. Given the long-time 

horizon modeled in the LCC, the 

application of a marginal interest rate 

associated with an initial source of 

funds is inaccurate. Regardless of the 

method of purchase, consumers are 

expected to continue to rebalance their 

debt and asset holdings over the LCC 

analysis period, based on the 

restrictions consumers face in their debt 

payment requirements and the relative 

size of the interest rates available on 

debts and assets. DOE estimates the 

aggregate impact of this rebalancing 

using the historical distribution of debts 

and assets. 

To establish residential discount rates 

for the LCC analysis, DOE identified all 

relevant household debt or asset classes 

in order to approximate a consumer’s 

opportunity cost of funds related to 

appliance energy cost savings. It 

estimated the average percentage shares 

of the various types of debt and equity 

by household income group using data 

from the Federal Reserve Board’s 

triennial Survey of Consumer 

Finances 63 (‘‘SCF’’) starting in 1995 and 

ending in 2019. Using the SCF and other 

sources, DOE developed a distribution 

of rates for each type of debt and asset 

by income group to represent the rates 

that may apply in the year in which the 

new standards would take effect. DOE 

assigned each sample household a 

specific discount rate drawn from one of 

the distributions. The average rate 

across all types of household debt and 

equity and income groups, weighted by 

the shares of each type, is 3.7 percent. 

To establish non-residential discount 

rates, DOE estimated the weightedaverage cost of capital using data from 

Damodaran Online.64 The weightedaverage cost of capital is commonly 

used to estimate the present value of 

cash flows to be derived from a typical 

company project or investment. Most 

companies use both debt and equity 

capital to fund investments, so their cost 

of capital is the weighted average of the 

cost to the firm of equity and debt 

financing. DOE estimated the cost of 

equity using the capital asset pricing 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87097 

65NEMA Standards Publication MG 1–2016, 

‘‘Motors and Generators: Air-Over Motor Efficiency 

Test Method Section IV Part 34’’, www.nema.org/ 

docs/default-source/standards-document-library/ 

part-34-addition-to-mg1-2016-watermarkd91d7834- 

cf4f-4a87-b86f-bef96b7dad54.pdf?sfvrsn=cbf1386d_

3. 

66 Vernon, D., and Meier, A. (2012). 

‘‘Identification and quantification of principal-agent 

problems affecting energy efficiency investments 

and use decisions in the trucking industry,’’ Energy 

Policy, 49, 266–273. 67Blum, H. and Sathaye, J. (2010). ‘‘Quantitative 

Analysis of the Principal-Agent Problem in 

Commercial Buildings in the U.S.: Focus on Central 

Space Heating and Cooling,’’ Lawrence Berkeley 

National Laboratory, LBNL–3557E. (Available at: 

escholarship.org/uc/item/6p1525mg) (Last accessed 

January 20, 2022). 

model, which assumes that the cost of 

equity for a particular company is 

proportional to the systematic risk faced 

by that company. The average 

commercial and industrial discount 

rates are 6.8 percent and 7.3 percent, 

respectively. 

See chapter 8 of the NOPR TSD for 

further details on the development of 

consumer discount rates. 

8. Energy Efficiency Distribution in the 

No-New-Standards Case 

To accurately estimate the share of 

consumers that would be affected by a 

potential energy conservation standard 

at a particular efficiency level, DOE’s 

LCC analysis considered the projected 

distribution (market shares) of 

equipment efficiencies under the nonew-standards case (i.e., the case 

without amended or new energy 

conservation standards). 

In the March 2022 Preliminary 

Analysis, DOE relied on model counts 

by efficiency from the 2016 and 2020 

Manufacturer Catalog Data to estimate 

the energy efficiency distribution of 

electric motors for 2027 and assumed no 

changes in electric motor efficiency over 

time. For some AO–ESEM 

representative units, DOE did not have 

enough models with efficiency 

information and used the efficiency 

distributions of the corresponding nonAO equipment class instead. In the 

March 2022 Preliminary Analysis, DOE 

used a Monte Carlo simulation to draw 

from the efficiency distributions and 

randomly assign an efficiency to the 

electric motor purchased by each 

sample household in the no-newstandards case. The resulting percent 

shares within the sample match the 

market shares in the efficiency 

distributions. See chapter 8 of the 

March 2022 Preliminary TSD. 

In response to the March 2022 

Preliminary Analysis, NEMA disagreed 

with the DOE estimates for ESEM and 

AO–ESEM efficiency distributions and 

commented that these distributions 

were modeled/estimated, rather than 

gathered properly and accurately 

through testing and other means. NEMA 

commented that DOE should not 

develop estimates and interpolations 

and instead finalize test procedures. 

NEMA added that energy efficiency 

information does not exist because 

Federal test procedures for some of 

these motors have not been established. 

(NEMA, No. 22 at p. 23) 

As noted previously, due to the very 

high volume of combinations of motor 

topologies, horsepower, frame sizes, 

pole counts, speeds, unique motor 

construction, and other parameters, 

DOE has recognized it to be unrealistic 

to test every possible motor available in 

the U.S. market. In the absence of such 

data, DOE relied on model counts by 

efficiency from manufacturer Catalog 

Data and updated the data to reflect 

2022 catalog offerings (using the 2022 

Motor Database). In addition, the 

electric motors test procedure finalized 

in the October 2022 Final Rule relies on 

industry test methods published in 

2016.65 87 FR 63588. For ESEMs, DOE 

believes manufacturers have used, and 

currently use, these industry test 

methods to evaluate the efficiency of 

electric motors as reported in their 

catalogs. 

As previously noted, in the March 

2022 Preliminary Analysis, DOE 

assumed no changes in electric motor 

efficiency over time. DOE did not 

receive any comment on this 

assumption and retained the same 

approach in this NOPR: to estimate the 

energy efficiency distribution of electric 

motors for 2029, DOE assumed no 

changes in electric motor efficiency over 

time. The estimated market shares for 

the no-new-standards case for electric 

motors are shown in Table IV–8 by 

equipment class group and horsepower 

range. 

TABLE IV–8—NO-NEW STANDARDS CASE EFFICIENCY DISTRIBUTIONS IN THE COMPLIANCE YEAR

Equipment class group Horsepower range EL0 

(%) 

EL1 

(%) 

EL2 

(%) 

EL3 

(%) 

EL4 

(%) 

ESEM High/Med Torque .................... 0.25 ≤ hp ≤ 0.50 ................................ 24.1 43.1 16.2 16.0 0.7 

0.5 < hp ≤ 3 ....................................... 37.5 49.1 11.9 1.4 0.1 

ESEM Low Torque ............................ 0.25 hp ............................................... 4.2 16.0 79.9 0.0 0.0 

0.25 < hp ≤ 3 ..................................... 41.5 22.0 26.8 9.8 0.0 

ESEM Polyphase ............................... 0.25 ≤ hp ≤ 3 ..................................... 9.6 23.1 53.3 13.4 0.5 

AO–ESEM High/Med Torque ............ 0.25 ≤ hp ≤ 0.50 ................................ 26.7 33.3 20.0 6.7 13.3 

0.5 < hp ≤ 3 ....................................... 32.4 38.2 17.6 11.8 0.0 

AO–ESEM Low Torque ..................... 0.25 hp ............................................... 1.8 21.8 58.2 18.2 0.0 

0.25 < hp ≤ 3 ..................................... 9.8 26.1 55.4 8.7 0.0 

AO–ESEM Polyphase ........................ 0.25 ≤ hp ≤ 3 ..................................... 37.7 26.0 33.8 2.6 0.0 

* May not sum to 100% due to rounding. 

The LCC Monte Carlo simulations 

draw from the efficiency distributions 

and randomly assign an efficiency to the 

ESEM purchased by each sample 

household in the no-new-standards 

case. The resulting percent shares 

within the sample match the market 

shares in the efficiency distributions. 

The existence of market failures in the 

commercial and industrial sectors is 

well supported by the economics 

literature and by a number of case 

studies as discussed in the remainder of 

this section. DOE did not receive any 

comments specific to the random 

assignment of no-new-standards case 

efficiencies (sampled from the 

developed efficiency distribution) in the 

LCC model and continued to rely on the 

same approach to reflect market failures 

in the ESEM market, as noted in the 

following examples. First, a recognized 

problem in commercial settings is the 

principal-agent problem, where the 

building owner (or building developer) 

selects the equipment and the tenant (or 

subsequent building owner) pays for 

energy costs.66 67 In the case of ESEMs, 

for many companies, the energy bills are 

paid for the company as a whole and 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87098 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

68Nadel, S., R.N. Elliott, M. Shepard, S. 

Greenberg, G. Katz & A.T. de Almedia. 2002. 

Energy-Efficient Motor Systems: A Handbook on 

Technology, Program and Policy Opportunities. 

Washington, DC: American Council for an EnergyEfficient Economy. Second Edition. 

69 DeCanio, S.J. (1994). ‘‘Agency and control 

problems in US corporations: the case of energyefficient investment projects,’’ Journal of the 

Economics of Business, 1(1), 105–124. 

Stole, L.A., and Zwiebel, J. (1996). 

‘‘Organizational design and technology choice 

under intrafirm bargaining,’’ The American 

Economic Review, 195–222. 

70 Xenergy, Inc. (1998). United States Industrial 

Electric Motor Systems Market Opportunity 

Assessment. (Available at: www.energy.gov/sites/ 

default/files/2014/04/f15/mtrmkt.pdf) (Last 

accessed January 20, 2022). 

71Fazzari, S.M., Hubbard, R.G., Petersen, B.C., 

Blinder, A.S., and Poterba, J.M. (1988). ‘‘Financing 

constraints and corporate investment,’’ Brookings 

Papers on Economic Activity, 1988(1), 141–206. 

Cummins, J.G., Hassett, K.A., Hubbard, R.G., Hall, 

R.E., and Caballero, R.J. (1994). ‘‘A reconsideration 

of investment behavior using tax reforms as natural 

experiments,’’ Brookings Papers on Economic 

Activity, 1994(2), 1–74. 

DeCanio, S.J., and Watkins, W.E. (1998). 

‘‘Investment in energy efficiency: do the 

characteristics of firms matter?’’ Review of 

Economics and Statistics, 80(1), 95–107. 

Hubbard R.G. and Kashyap A. (1992). ‘‘Internal 

Net Worth and the Investment Process: An 

Application to U.S. Agriculture,’’ Journal of 

Political Economy, 100, 506–534. 

72de Almeida, E.L.F. (1998). ‘‘Energy efficiency 

and the limits of market forces: The example of the 

electric motor market in France’’, Energy Policy, 

26(8), 643–653. 

73 DOE uses data on manufacturer shipments as 

a proxy for national sales, as aggregate data on sales 

are lacking. In general, one would expect a close 

correspondence between shipments and sales. 

not allocated to individual departments. 

This practice provides maintenance and 

engineering staff little incentives to 

pursue energy saving investments 

because the savings in energy bills 

provide little benefits to the decisionmaking maintenance and engineering 

staff. (Nadel et al.) 68 Second, the nature 

of the organizational structure and 

design can influence priorities for 

capital budgeting, resulting in choices 

that do not necessarily maximize 

profitability.69 In the case of ESEMs, 

within manufacturing as a whole, motor 

system energy costs constitute less than 

1 percent of total operating costs and 

energy efficiency has a low level of 

priority among capital investment and 

operating objectives. (Xenergy,70 Nadel 

et al.) Third, there are asymmetric 

information and other potential market 

failures in financial markets in general, 

which can affect decisions by firms with 

regard to their choice among alternative 

investment options, with energy 

efficiency being one such option.71 In 

the case of electric motors, Xenergy 

identified the lack of information 

concerning the nature of motor system 

efficiency measures—their benefits, 

costs, and implementation procedures— 

as a principal barrier to their adoption. 

In addition, Almeida 72 reports that the 

attitude of electric motor end-user is 

characterized by bounded rationality 

where they adopt ‘‘rule of thumb’’ 

routines because of the complexity of 

market structure which makes it 

difficult for motors end-users to get all 

the information they need to make an 

optimum decision concerning allocation 

of resources. The rule of thumb is to buy 

the same type and brand as the failed 

motor from the nearest retailer. Almeida 

adds that the same problem of bounded 

rationality exists when end-users 

purchase electric motors incorporated in 

larger equipment. In general, end-users 

are only concerned about the overall 

performance of a machine, and energy 

efficiency is rarely a key factor in this 

performance. Motor selection is 

therefore often left to the OEM, which 

are not responsible for energy costs and 

prioritize price and reliability. 

See chapter 8 of the NOPR TSD for 

further information on the derivation of 

the efficiency distributions. 

DOE seeks information and data to 

help establish efficiency distribution in 

the no-new standards case for ESEMs. 

DOE requests data and information on 

any trends in the electric motor market 

that could be used to forecast expected 

trends in market share by efficiency 

levels for each equipment class. 

9. Payback Period Analysis 

The payback period is the amount of 

time (expressed in years) it takes the 

consumer to recover the additional 

installed cost of more-efficient 

equipment, compared to baseline 

equipment, through energy cost savings. 

Payback periods that exceed the life of 

the equipment mean that the increased 

total installed cost is not recovered in 

reduced operating expenses. 

The inputs to the PBP calculation for 

each efficiency level are the change in 

total installed cost of the equipment and 

the change in the first-year annual 

operating expenditures relative to the 

baseline. DOE refers to this as a ‘‘simple 

PBP’’ because it does not consider 

changes over time in operating cost 

savings. The PBP calculation uses the 

same inputs as the LCC analysis when 

deriving first-year operating costs. 

As noted previously, EPCA 

establishes a rebuttable presumption 

that a standard is economically justified 

if the Secretary finds that the additional 

cost to the consumer of purchasing an 

equipment complying with an energy 

conservation standard level will be less 

than three times the value of the first 

year’s energy savings resulting from the 

standard, as calculated under the 

applicable test procedure. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(2)(B)(iii)) For 

each considered efficiency level, DOE 

determined the value of the first year’s 

energy savings by calculating the energy 

savings in accordance with the 

applicable DOE test procedure, and 

multiplying those savings by the average 

energy price projection for the year in 

which compliance with the new 

standards would be required. 

G. Shipments Analysis 

DOE uses projections of annual 

equipment shipments to calculate the 

national impacts of potential new 

energy conservation standards on 

energy use, NPV, and future 

manufacturer cash flows.73 The 

shipments model takes an accounting 

approach, tracking market shares of 

each equipment class and the vintage of 

units in the stock. Stock accounting uses 

equipment shipments as inputs to 

estimate the age distribution of inservice product stocks for all years. The 

age distribution of in-service product 

stocks is a key input to calculations of 

both the NES and NPV, because 

operating costs for any year depend on 

the age distribution of the stock. 

First, in the March 2022 Preliminary 

Analysis, DOE estimated shipments in 

the base year (2020). DOE estimated the 

total shipments of ESEMs in 2020 to be 

28.6 million units (including 7.9 million 

units of AO ESEMs). DOE developed a 

distribution of shipments by equipment 

class group and horsepower range based 

on model counts from the 2020 and 

2016/2020 Manufacturer Catalog Data. 

See chapter 9 of the March 2022 

Preliminary Analysis TSD. 

DOE did not receive any comments 

related to the base year shipments 

estimates for ESEMs and retained the 

values estimated in the preliminary 

analysis in this NOPR, however, DOE 

only included motors up to 3hp, which 

were in the recommended scope of the 

December 2022 Joint Recommendation. 

For ESEMs (including AO ESEMs), DOE 

revised the distribution of shipments by 

horsepower range based on model 

counts from the 2022 Manufacturer 

Catalog Data. 

In the March 2022 Preliminary 

Analysis, DOE projected shipments for 

ESEMs in the no-new standards case 

under the assumption that long-term 

growth of electric motor shipments will 

be driven the following sector-specific 

market drivers from AEO2021: 

commercial building floor space, 

housing numbers, and value of 

manufacturing activity for the 

commercial, residential, and industrial 

sector, respectively. In addition, DOE 

kept the distribution of shipments by 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87099 

74The NIA accounts for impacts in the 50 states 

and U.S. territories. 

equipment class group and horsepower 

range constant across the analysis 

period. 

In response to the March 2022 

Preliminary Analysis, NEMA 

commented that legacy induction 

motors are being replaced by PDS (or 

power drive systems) consisting of a 

motor and controls/drives as a means to 

dramatically reduce power and integrate 

motor driven systems into sophisticated 

control schemes that continuously 

monitor processes managing flow, 

pressure, etc., to reduce operating costs 

and emissions. (NEMA, No. 22 at p. 23) 

In the case of ESEMs, DOE agrees with 

NEMA that some ESEMs could be 

replaced by non-induction motors such 

as ECMs. However, DOE does not have 

sufficient data to quantify the 

magnitude of such substitution, which 

could result in lower ESEM shipments. 

Instead, DOE established two additional 

shipments sensitivity scenario to 

account for the impacts of lower/higher 

ESEMs shipments estimates. 

DOE did not receive any other 

comments specific to ESEM shipments 

projections and retained the same 

methodology as in the March 2022 

Preliminary Analysis in this NOPR and 

revised the projections based on 

AEO2023. 

DOE requests comment and 

additional data on its 2020 shipments 

estimates for ESEMs. DOE seeks 

comment on the methodology used to 

project future shipments of ESEMs. DOE 

seeks information on other data sources 

that can be used to estimate future 

shipments. 

H. National Impact Analysis 

The NIA assesses the NES and the 

NPV from a national perspective of total 

consumer costs and savings that would 

be expected to result from new 

standards at specific efficiency levels.74

(‘‘Consumer’’ in this context refers to 

consumers of the equipment being 

regulated.) DOE calculates the NES and 

NPV for the potential standard levels 

considered based on projections of 

annual equipment shipments, along 

with the annual energy consumption 

and total installed cost data from the 

energy use and LCC analyses. For the 

present analysis, DOE projected the 

energy savings, operating cost savings, 

product costs, and NPV of consumer 

benefits over the lifetime of ESEMs sold 

from 2029 through 2058. 

DOE evaluates the impacts of new 

standards by comparing a case without 

such standards with standards-case 

projections. The no-new-standards case 

characterizes energy use and consumer 

costs for each equipment class in the 

absence of new energy conservation 

standards. For this projection, DOE 

considers any historical trends in 

efficiency and various forces that are 

likely to affect the mix of efficiencies 

over time. DOE compares the no-newstandards case with projections 

characterizing the market for each 

equipment class if DOE adopted new 

standards at specific energy efficiency 

levels (i.e., the TSLs or standards cases) 

for that class. For the standards cases, 

DOE considers how a given standard 

would likely affect the market shares of 

equipment with efficiencies greater than 

the standard. 

DOE uses a spreadsheet model to 

calculate the energy savings and the 

national consumer costs and savings 

from each TSL. Interested parties can 

review DOE’s analyses by changing 

various input quantities within the 

spreadsheet. The NIA spreadsheet 

model uses typical values (as opposed 

to probability distributions) as inputs. 

Table IV–9 summarizes the inputs 

and methods DOE used for the NIA 

analysis for the NOPR. Discussion of 

these inputs and methods follows the 

table. See chapter 10 of the NOPR TSD 

for further details. 

TABLE IV–9—SUMMARY OF INPUTS AND METHODS FOR THE NATIONAL IMPACT ANALYSIS

Inputs Method 

Shipments ....................................................... Annual shipments from shipments model. 

Compliance Date of Standard ......................... 2029. 

Efficiency Trends ............................................. No-new-standards case: constant trend. 

Standards cases: constant trend. 

Annual Energy Consumption per Unit ............ Annual weighted-average values are a function of energy use at each TSL. 

Total Installed Cost per Unit ........................... Annual weighted-average values are a function of cost at each TSL. 

Incorporates projection of future product prices based on historical data. (constant trend). 

Annual Energy Cost per Unit .......................... Annual weighted-average values as a function of the annual energy consumption per unit and 

energy prices. 

Repair and Maintenance Cost per Unit .......... Maintenance costs: No change with efficiency level. 

Repair costs: No repair. 

Energy Price Trends ....................................... AEO2023 projections (to 2050) and held constant thereafter. 

Energy Site-to-Primary and FFC Conversion A time-series conversion factor based on AEO2023. 

Discount Rate .................................................. Three and seven percent. 

Present Year ................................................... 2024. 

1. Equipment Efficiency Trends 

A key component of the NIA is the 

trend in energy efficiency projected for 

the no-new-standards case and each of 

the standards cases. Section IV.F.8 of 

this document describes how DOE 

developed an energy efficiency 

distribution for the no-new-standards 

case (which yields a shipment-weighted 

average efficiency) for each of the 

considered equipment classes for the 

year of anticipated compliance with a 

new standard. To project the trend in 

efficiency absent new standards for 

ESEMs and AO–ESEMs over the entire 

shipments projection period, DOE 

applied a constant trend, similar to what 

was done in the March 2022 

Preliminary Analysis. The approach is 

further described in chapter 10 of the 

NOPR TSD. 

For the standards cases, DOE used a 

‘‘roll-up’’ scenario to establish the 

shipment-weighted efficiency for the 

year that standards are assumed to 

become effective (2029). In this 

scenario, the market shares of 

equipment in the no-new-standards case 

that do not meet the standard under 

consideration would ‘‘roll up’’ to meet 

the new standard level, and the market 

share of products above the standard 

would remain unchanged. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87100 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

75See, e.g., 86 FR 36111 for further discussion 

regarding DOE’s explanation and findings regarding 

rebound effect for electric motors, broadly. 

76For more information on NEMS, refer to The 

National Energy Modeling System: An Overview 

2009, DOE/EIA–0581(2009), October 2009. 

Available at www.eia.gov/forecasts/aeo/index.cfm 

(last accessed 5/1/2023). 

77United States Office of Management and 

Budget. Circular A–4: Regulatory Analysis. 

September 17, 2003. Section E. Available at 

georgewbush-whitehouse.archives.gov/omb/ 

memoranda/m03-21.html (last accessed May 1, 

2023). 

To develop standards case efficiency 

trends after 2029, DOE assumed no 

change over the forecast period. 

DOE did not receive any comments on 

the projected efficiency trends in 

response to the March 2022 Preliminary 

Analysis and retained the same 

approach in this NOPR. 

2. National Energy Savings 

The national energy savings analysis 

involves a comparison of national 

energy consumption of the considered 

products between each potential 

standards case (‘‘TSL’’) and the case 

with no new energy conservation 

standards. DOE calculated the national 

energy consumption by multiplying the 

number of units (stock) of each 

equipment (by vintage or age) by the 

unit energy consumption (also by 

vintage). DOE calculated annual NES 

based on the difference in national 

energy consumption for the no-newstandards case and for each higher 

efficiency standard case. DOE estimated 

energy consumption and savings based 

on site energy and converted the 

electricity consumption and savings to 

primary energy (i.e., the energy 

consumed by power plants to generate 

site electricity) using annual conversion 

factors derived from AEO2023. 

Cumulative energy savings are the sum 

of the NES for each year over the 

timeframe of the analysis. 

Use of higher-efficiency equipment is 

sometimes associated with a direct 

rebound effect, which refers to an 

increase in utilization of the equipment 

due to the increase in efficiency. In the 

March 2022 Preliminary Analysis, DOE 

requested comment and data regarding 

the potential increase in utilization of 

electric motors due to any increase in 

efficiency. See section 2.10.1 of the 

March 2022 Preliminary TSD. DOE did 

not find any data on the rebound effect 

specific to electric motors 75 and did not 

receive any comments supporting the 

inclusion of a rebound effect for ESEMs 

and AO–ESEMs. Therefore, DOE did not 

apply a rebound effect for ESEMs and 

AO–ESEMs. 

In 2011, in response to the 

recommendations of a committee on 

‘‘Point-of-Use and Full-Fuel-Cycle 

Measurement Approaches to Energy 

Efficiency Standards’’ appointed by the 

National Academy of Sciences, DOE 

announced its intention to use FFC 

measures of energy use and greenhouse 

gas and other emissions in the national 

impact analyses and emissions analyses 

included in future energy conservation 

standards rulemakings. 76 FR 51281 

(Aug. 18, 2011). After evaluating the 

approaches discussed in the August 18, 

2011 notice, DOE published a statement 

of amended policy in which DOE 

explained its determination that EIA’s 

National Energy Modeling System 

(‘‘NEMS’’) is the most appropriate tool 

for its FFC analysis and its intention to 

use NEMS for that purpose. 77 FR 49701 

(Aug. 17, 2012). NEMS is a public 

domain, multi-sector, partial 

equilibrium model of the U.S. energy 

sector 76 that EIA uses to prepare its 

Annual Energy Outlook. The FFC factors 

incorporate losses in production and 

delivery in the case of natural gas 

(including fugitive emissions) and 

additional energy used to produce and 

deliver the various fuels used by power 

plants. The approach used for deriving 

FFC measures of energy use and 

emissions is described in appendix 10B 

of the NOPR TSD. 

3. Net Present Value Analysis 

The inputs for determining the NPV 

of the total costs and benefits 

experienced by consumers are (1) total 

annual installed cost, (2) total annual 

operating costs (energy costs and repair 

and maintenance costs), and (3) a 

discount factor to calculate the present 

value of costs and savings. DOE 

calculates net savings each year as the 

difference between the no-newstandards case and each standards case 

in terms of total savings in operating 

costs versus total increases in installed 

costs. DOE calculates operating cost 

savings over the lifetime of each 

equipment shipped during the 

projection period. 

As discussed in section IV.F.1 of this 

document, DOE developed constant 

ESEM price trends based on historical 

PPI data. DOE applied the same trends 

to project prices for each equipment 

class at each considered efficiency level. 

DOE’s projection of equipment prices is 

described in appendix 10C of the NOPR 

TSD. 

To evaluate the effect of uncertainty 

regarding the price trend estimates, DOE 

investigated the impact of different 

equipment price projections on the 

consumer NPV for the considered TSLs 

for ESEMs. In addition to the default 

price trend, DOE considered two 

equipment price sensitivity cases: (1) a 

high price decline case and (2) a low 

price decline case based on historical 

PPI data. The derivation of these price 

trends and the results of these 

sensitivity cases are described in 

appendix 10C of the NOPR TSD. 

The energy cost savings are calculated 

using the estimated energy savings in 

each year and the projected price of the 

appropriate form of energy. To estimate 

energy prices in future years, DOE 

multiplied the average regional energy 

prices by the projection of annual 

national-average residential energy price 

changes in the Reference case from 

AEO2023, which has an end year of 

2050. To estimate price trends after 

2050, the 2050 value was used for all 

years. As part of the NIA, DOE also 

analyzed scenarios that used inputs 

from variants of the AEO2023 Reference 

case that have lower and higher 

economic growth. Those cases have 

lower and higher energy price trends 

compared to the Reference case. NIA 

results based on these cases are 

presented in appendix 10C of the NOPR 

TSD. 

In calculating the NPV, DOE 

multiplies the net savings in future 

years by a discount factor to determine 

their present value. For this NOPR, DOE 

estimated the NPV of consumer benefits 

using both a 3-percent and a 7-percent 

real discount rate. DOE uses these 

discount rates in accordance with 

guidance provided by the Office of 

Management and Budget (‘‘OMB’’) to 

Federal agencies on the development of 

regulatory analysis.77 The discount rates 

for the determination of NPV are in 

contrast to the discount rates used in the 

LCC analysis, which are designed to 

reflect a consumer’s perspective. The 7- 

percent real value is an estimate of the 

average before-tax rate of return to 

private capital in the U.S. economy. The 

3-percent real value represents the 

‘‘social rate of time preference,’’ which 

is the rate at which society discounts 

future consumption flows to their 

present value. 

DOE requests comment and data 

regarding the potential increase in 

utilization of electric motors due to any 

increase in efficiency (‘‘rebound 

effect’’). 

I. Consumer Subgroup Analysis 

In analyzing the potential impact of 

new energy conservation standards on 

consumers, DOE evaluates the impact 

on identifiable subgroups of consumers 

that may be disproportionately affected 

by a new national standard. The 

purpose of a subgroup analysis is to 

determine the extent of any such 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87101 

78See www.sec.gov/edgar. 

79See www.census.gov/programs-surveys/asm/ 

data/tables.html. 

80See app.avention.com. 

disproportional impacts. DOE evaluates 

impacts on particular subgroups of 

consumers by analyzing the LCC 

impacts and PBP for those particular 

consumers from alternative standard 

levels. For this NOPR, DOE analyzed the 

impacts of the considered standard 

levels on three subgroups: (1) lowincome households (for ESEMs used in 

the residential sector); (2) senior-only 

households (for ESEMs used in the 

residential sector); and (3) smallbusinesses. The analysis used subsets of 

the RECS 2020 sample composed of 

households that meet the criteria for the 

low-income and senior-only household 

subgroups. For small-businesses 

subgroup, DOE used the same sample of 

consumers but with subgroup-specific 

inputs. DOE determined the impact on 

the electric motors subgroups using the 

same LCC model, which is used for all 

consumers, but with subgroup-specific 

inputs as applicable. 

In response to the March 2022 

Preliminary Analysis, AHAM and AHRI 

commented that a forced redesign of 

motors used in finished goods will force 

changes by the OEM. AHAM and AHRI 

commented that this would be 

particularly damaging for small 

appliances and floor care products, 

which use special purpose motors and 

are sensitive to even small increases in 

component part costs. AHAM and AHRI 

commented that the increased cost 

could make some appliances and 

equipment too costly for low-income 

consumers to purchase and delay 

purchases of more efficient appliances 

and equipment for middle-income 

consumers. (AHAM and AHRI, No. 25 at 

pp. 9–10) In response to these 

comments, DOE performed a subgroup 

analysis for low-income consumers 

showing these consumers would not be 

disproportionately impacted. See 

section V.B.1.b of this document. 

Chapter 11 in the NOPR TSD 

describes the consumer subgroup 

analysis. 

DOE requests comment and data on 

the overall methodology used for the 

consumer subgroup analysis. DOE 

requests comment on whether 

additional consumer subgroups may be 

disproportionately affected by a new 

standard and warrant additional 

analysis in the final rule. 

J. Manufacturer Impact Analysis 

1. Overview 

DOE performed an MIA to estimate 

the financial impacts of new energy 

conservation standards on 

manufacturers of ESEMs and to estimate 

the potential impacts of such standards 

on employment and manufacturing 

capacity. The MIA has both quantitative 

and qualitative aspects and includes 

analyses of projected industry cash 

flows, the INPV, investments in research 

and development (‘‘R&D’’) and 

manufacturing capital, and domestic 

manufacturing employment. 

Additionally, the MIA seeks to 

determine how new energy conservation 

standards might affect manufacturing 

employment, capacity, and competition, 

as well as how standards contribute to 

overall regulatory burden. Finally, the 

MIA serves to identify any 

disproportionate impacts on 

manufacturer subgroups, including 

small business manufacturers. 

The quantitative part of the MIA 

primarily relies on the GRIM, an 

industry cash flow model with inputs 

specific to this proposed rulemaking. 

The key GRIM inputs include data on 

the industry cost structure, unit 

production costs, equipment shipments, 

manufacturer markups, and investments 

in R&D and manufacturing capital 

required to produce compliant products. 

The key GRIM outputs are the INPV, 

which is the sum of industry annual 

cash flows over the analysis period, 

discounted using the industry-weighted 

average cost of capital, and the impact 

to domestic manufacturing employment. 

The model uses standard accounting 

principles to estimate the impacts of 

energy conservation standards on a 

given industry by comparing changes in 

INPV and domestic manufacturing 

employment between a no-newstandards case and the various 

standards cases (i.e., TSLs). To capture 

the uncertainty relating to manufacturer 

pricing strategies following new 

standards, the GRIM estimates a range of 

possible impacts under different 

manufacturer markup scenarios. 

The qualitative part of the MIA 

addresses manufacturer characteristics 

and market trends. Specifically, the MIA 

considers such factors as a potential 

standard’s impact on manufacturing 

capacity, competition within the 

industry, the cumulative impact of other 

DOE and non-DOE regulations, and 

impacts on manufacturer subgroups. 

The complete MIA is outlined in 

chapter 12 of the NOPR TSD. 

DOE conducted the MIA for this 

rulemaking in three phases. In Phase 1 

of the MIA, DOE prepared a profile of 

the ESEMs manufacturing industry 

based on the market and technology 

assessment, preliminary manufacturer 

interviews, and publicly-available 

information. This included a top-down 

analysis of ESEM manufacturers that 

DOE used to derive preliminary 

financial inputs for the GRIM (e.g., 

revenues; materials, labor, overhead, 

and depreciation expenses; selling, 

general, and administrative expenses 

(‘‘SG&A’’); and R&D expenses). DOE 

also used public sources of information 

to further calibrate its initial 

characterization of the ESEM 

manufacturing industry, including 

company filings of form 10–K from the 

SEC, corporate annual reports,78 the 

U.S. Census Bureau’s Economic 

Census,79 and reports from D&B 

Hoovers.80

In Phase 2 of the MIA, DOE prepared 

a framework industry cash-flow analysis 

to quantify the potential impacts of new 

energy conservation standards. The 

GRIM uses several factors to determine 

a series of annual cash flows starting 

with the announcement of the standard 

and extending over a 30-year period 

following the compliance date of the 

standard. These factors include annual 

expected revenues, costs of sales, SG&A 

and R&D expenses, taxes, and capital 

expenditures. In general, energy 

conservation standards can affect 

manufacturer cash flow in three distinct 

ways: (1) creating a need for increased 

investment, (2) raising production costs 

per unit, and (3) altering revenue due to 

higher per-unit prices and changes in 

sales volumes. 

In addition, during Phase 2, DOE 

developed interview guides to distribute 

to manufacturers of ESEMs in order to 

develop other key GRIM inputs, 

including product and capital 

conversion costs, and to gather 

additional information on the 

anticipated effects of energy 

conservation standards on revenues, 

direct employment, capital assets, 

industry competitiveness, and subgroup 

impacts. 

In Phase 3 of the MIA, DOE 

conducted structured, detailed 

interviews with representative 

manufacturers. During these interviews, 

DOE discussed engineering, 

manufacturing, procurement, and 

financial topics to validate assumptions 

used in the GRIM and to identify key 

issues or concerns. See section IV.J.3 of 

this document for a description of the 

key issues raised by manufacturers 

during the interviews. As part of Phase 

3, DOE also evaluated subgroups of 

manufacturers that may be 

disproportionately impacted by new 

standards or that may not be accurately 

represented by the average cost 

assumptions used to develop the 

industry cash flow analysis. Such 

manufacturer subgroups may include 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87102 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

small business manufacturers, lowvolume manufacturers, niche players, 

and/or manufacturers exhibiting a cost 

structure that largely differs from the 

industry average. DOE identified one 

subgroup for a separate impact analysis: 

small business manufacturers. The 

small business subgroup is discussed in 

section VI.B, ‘‘Review under the 

Regulatory Flexibility Act’’, of this 

document and in chapter 12 of the 

NOPR TSD. 

2. Government Regulatory Impact Model 

and Key Inputs 

DOE uses the GRIM to quantify the 

changes in cash flow due to new 

standards that result in a higher or 

lower industry value. The GRIM uses a 

standard, annual discounted cash-flow 

analysis that incorporates manufacturer 

costs, markups, shipments, and industry 

financial information as inputs. The 

GRIM models changes in costs, 

distribution of shipments, investments, 

and manufacturer margins that could 

result from new energy conservation 

standard. The GRIM spreadsheet uses 

the inputs to arrive at a series of annual 

cash flows, beginning in 2024 (the base 

year of the analysis) and continuing to 

2058. DOE calculated INPVs by 

summing the stream of annual 

discounted cash flows during this 

period. For manufacturers of ESEMs, 

DOE initially estimated a real discount 

rate of 9.1 percent, which was the real 

discount rate used in the previous 

medium electric motors final rule that 

published on May 29, 2014 (‘‘May 2014 

Electric Motors Final Rule’’). 79 FR 

30934, 30938. DOE then asked for 

feedback on this value during 

manufacturer interviews. Manufacturers 

agreed this was still an appropriate 

value to use. Therefore, DOE used a real 

discount rate of 9.1 percent for the 

analysis in this NOPR. 

The GRIM calculates cash flows using 

standard accounting principles and 

compares changes in INPV between the 

no-new-standards case and each 

standards case. The difference in INPV 

between the no-new-standards case and 

a standards case represents the financial 

impact of new energy conservation 

standards on manufacturers. As 

discussed previously, DOE developed 

critical GRIM inputs using a number of 

sources, including publicly available 

data, results of the engineering analysis, 

and information gathered from industry 

stakeholders during the course of 

manufacturer interviews and 

subsequent working group meetings. 

The GRIM results are presented in 

section V.B.2 of this document. 

Additional details about the GRIM, the 

discount rate, and other financial 

parameters can be found in chapter 12 

of the NOPR TSD. 

a. Manufacturer Production Costs 

Manufacturing more efficient 

equipment is typically more expensive 

than manufacturing baseline equipment 

due to the use of more complex 

components, which are typically more 

costly than baseline components. The 

changes in the MPCs of covered 

equipment can affect the revenues, gross 

margins, and cash flow of the industry. 

DOE conducted the engineering 

analysis using a combination of physical 

teardowns and software modeling. DOE 

contracted a professional motor 

laboratory to disassemble various 

ESEMs and record what types of 

materials were present and how much 

of each material was present, recorded 

in a final BOM. To supplement the 

physical teardowns, software modeling 

by a subject matter expert was also used 

to generate BOMs for select efficiency 

levels of directly analyzed 

representative units. 

For a complete description of the 

MPCs, see chapter 5 of the NOPR TSD. 

b. Shipments Projections 

The GRIM estimates manufacturer 

revenues based on total unit shipment 

projections and the distribution of those 

shipments by efficiency level. Changes 

in sales volumes and efficiency mix 

over time can significantly affect 

manufacturer finances. For this analysis, 

the GRIM uses the NIA’s annual 

shipment projections derived from the 

shipments analysis from 2024 (the base 

year) to 2058 (the end year of the 

analysis period). See chapter 9 of the 

NOPR TSD for additional details. 

c. Product and Capital Conversion Costs 

New energy conservation standards 

could cause manufacturers to incur 

conversion costs to bring their 

production facilities and equipment 

designs into compliance. DOE evaluated 

the level of conversion-related 

expenditures that would be needed to 

comply with each considered efficiency 

level in each equipment class. For the 

MIA, DOE classified these conversion 

costs into two major groups: (1) product 

conversion costs; and (2) capital 

conversion costs. Product conversion 

costs are investments in research, 

development, testing, marketing, and 

other non-capitalized costs necessary to 

make equipment designs comply with 

new energy conservation standards. 

Capital conversion costs are investments 

in property, plant, and equipment 

necessary to adapt or change existing 

production facilities such that new 

compliant equipment designs can be 

fabricated and assembled. 

DOE calculated the product and 

capital conversion costs using a bottomup approach based on feedback from 

manufacturers during manufacturer 

interviews. During manufacturer 

interviews, DOE asked manufacturers 

questions regarding the estimated 

equipment and capital conversion costs 

needed to produce ESEMs within an 

equipment class at each specific EL. 

DOE used the feedback provided by 

manufacturers to estimate the 

approximate amount of engineering 

time, testing costs, and capital 

equipment that would need to be 

purchased in order to redesign a single 

frame size for each EL. Some of the 

types of capital conversion costs 

manufacturers identified were the 

purchase of lamination die sets, 

winding machines, frame casts, and 

assembly equipment as well as other 

retooling costs. The two main types of 

product conversion costs manufacturers 

shared with DOE during interviews 

were the number of engineer hours 

necessary to re-engineer frames to meet 

higher efficiency standards and the 

testing costs, including thermal 

protection testing, to comply with 

higher efficiency standards. 

DOE then took average values (i.e., 

costs or number of hours) based on the 

range of responses given by 

manufacturers to calculate both the 

equipment and capital conversion cost 

necessary for a manufacturer to increase 

the efficiency of one frame size to a 

specific EL. DOE multiplied the 

conversion costs associated with 

manufacturing a single frame size at 

each EL by the number of frames each 

interviewed manufacturer produces. 

DOE finally scaled this number based 

on the market share of the 

manufacturers DOE interviewed to 

arrive at an industry-wide bottom-up 

product and capital conversion cost 

estimate for each representative unit at 

each EL. 

In response to the March 2022 

Preliminary Analysis, the Joint Industry 

Stakeholders and Lennox commented 

that there may be instances where 

substitution of a newer, larger, heavier, 

faster ESEM is feasible, but that it was 

not reasonable to assume this is always 

the case. The Joint Industry 

Stakeholders and Lennox added that 

OEM companies would be forced to 

expend significant resources seeking 

retrofit and repair options for recently 

purchased end-use OEM goods to 

account for unnecessary motor 

subcomponent changes. (Joint Industry 

Stakeholders, No. 23 at pp. 5–6; Lennox, 

No. 29 at p. 5) The Joint Industry 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87103 

Stakeholders added that this could 

particularly impact small businesses. 

(Joint Industry Stakeholders, No. 23 at 

p. 5–6) The Joint Stakeholder also 

commented that while OEM 

manufacturers would likely redesign 

product, and incur a cost to do so, to 

avoid issues resulting from new motors, 

there may not be suitable replacement 

motors, which are immediately 

available due to DOE’s proposed 

certification requirements, limiting 

approvals to a few third-party labs. The 

Joint Stakeholder added that these costs 

need to be accounted for in DOE’s 

analysis. (Id. at p. 8) 

In this NOPR, as noted in section 

IV.C.1 of this document, DOE assumes 

higher efficiency levels can be reached 

without resulting in any significant size 

increase and without changing the key 

electrical and mechanical characteristics 

of the motor. Therefore, DOE disagrees 

with the Joint Stakeholders and Lennox 

that the higher efficiency levels would 

force OEMs to redesign their equipment 

and result in redesign and re-tooling 

costs. 

As previously discussed, DOE revised 

the March 2022 Preliminary Analysis to 

account for space-constrained and nonspace constrained motor designs, which 

will continue to provide repair options 

to consumers. As stated in the December 

2022 Joint Recommendation, motor 

manufacturers believe that efficiency 

levels higher than EL 2 could result in 

significant increases in the physical size 

of certain motors. (Electric Motors 

Working Group, No. 38 at p. 4) As part 

of the engineering analysis, DOE models 

representative units that are able to meet 

the efficiency requirements of EL 2 and 

below that would not result in a 

significantly increase in the physical 

size of the ESEMs. For ELs higher than 

EL 2 (i.e., EL 3 and EL 4), DOE 

recognizes that ESEMs may significantly 

increase in physical size in order to 

meet those higher efficiency 

requirements. DOE also recognizes that 

this may result in a significant 

disruption to the OEM markets that 

used ESEMs as an embedded product. 

In addition, as discussed in section 

IV.C.3 of this document, DOE accounted 

for the impacts of any potential changes 

in speeds at higher efficiency levels. 

In response to the March 2022 

Preliminary Analysis, NEMA stated that 

many ESEMs have agency listings for 

thermal protection and any redesign of 

the motor will require retesting with the 

respective agencies. NEMA commented 

additionally that the time needed to 

complete this testing should be 

considered when setting the compliance 

date of any ESEM energy conservation 

standards, and that the cost associated 

with this agency testing must be 

accounted for in the cost analysis. 

(NEMA, No. 22 at pp. 3, 17) As 

previously stated in this section, DOE 

accounted for additional thermal 

protection testing in addition to the 

costs associated with redesigning each 

ESEM model as part of the product 

conversion costs. These product 

conversion costs, in addition to the 

capital conversion costs, are included 

when calculating the potential change 

in manufacturer INPV. 

NEMA also commented that DOE 

must capture the OEM impacts in terms 

of costs of redesigning and retooling. 

NEMA noted that these costs will have 

a very wide variation: some will involve 

a few hours’ worth of work while others 

could require several hundred hours 

plus material and recertification to 

regulating bodies and safety testers. 

NEMA commented further that single 

phase (and some small three phase) 

motors with agency certified overload 

protection will need several years to be 

recertified. In addition, NEMA noted 

that DOE should capture the installation 

cost impacts on end-users trying to 

repair appliances with larger, heavier, or 

faster replacement motors built to meet 

new standards. (NEMA, No. 22 at p. 21) 

In response to these comments and as 

noted in section IV.F of this document, 

DOE determined that the installation 

costs for ESEMs would not change at 

higher efficiency levels compared to the 

baseline as DOE is maintaining the 

frame size of ESEMs constant across all 

efficiency levels analyzed. DOE is 

further limiting the stack length to be no 

greater than 20 percent longer than the 

baseline unit for that representative 

unit. In addition, as noted in section 

IV.C.3 of this document, the speed of 

the ESEMs across efficiency levels did 

not always increase with increasing 

efficiency and DOE accounted for speed 

variations in its energy use analysis (see 

section IV.E.4 of this document for more 

details). 

In general, DOE assumes all 

conversion-related investments occur 

between the year of publication of the 

final rule and the year by which 

manufacturers must comply with new 

standards. The conversion cost figures 

used in the GRIM can be found in 

section V.B.2 of this document. For 

additional information on the estimated 

capital and product conversion costs, 

see chapter 12 of the NOPR TSD. 

d. Manufacturer Markup Scenarios 

MSPs include direct manufacturing 

production costs (i.e., labor, materials, 

and overhead estimated in DOE’s MPCs) 

and all non-production costs (i.e., 

SG&A, R&D, and interest), along with 

profit. To calculate the MSPs in the 

GRIM, DOE applied non-production 

cost markups to the MPCs estimated in 

the engineering analysis for each 

equipment class and efficiency level. 

Modifying these markups in the 

standards case yields different sets of 

impacts on manufacturers. For the MIA, 

DOE modeled two standards-case 

markup scenarios to represent 

uncertainty regarding the potential 

impacts on prices and profitability for 

manufacturers following the 

implementation of new energy 

conservation standards: (1) a 

preservation of gross margin scenario; 

and (2) a preservation of operating profit 

scenario. These scenarios lead to 

different markup values that, when 

applied to the MPCs, result in varying 

revenue and cash flow impacts. 

Under the preservation of gross 

margin scenario, DOE applied a single 

uniform ‘‘gross margin percentage’’ 

across all efficiency levels, which 

assumes that manufacturers would be 

able to maintain the same amount of 

profit as a percentage of revenues at all 

efficiency levels within an equipment 

class. DOE initially estimated a 

manufacturer markup of 1.37 for all 

ESEMs covered by this rulemaking in 

the no-new-standards case, which was 

the manufacturer markup for medium 

electric motors under 5 hp used in the 

May 2014 Electric Motors Final Rule. 79 

FR 30934, 30938. DOE then asked for 

feedback on this manufacturer markup 

during manufacturer interviews. 

Manufacturers agreed this was an 

appropriate manufacturer markup to use 

for ESEMs covered by this rulemaking. 

Therefore, DOE used this same 

manufacturer markup of 1.37 for all 

equipment classes and ELs at each TSL 

(i.e., the standards cases) in the 

preservation of gross margin scenario. 

This manufacturer markup scenario 

represents the upper-bound of 

manufacturer INPV and is the 

manufacturer markup scenario used to 

calculate the economic impacts on 

consumers. 

Under the preservation of operating 

profit scenario, DOE modeled a 

situation in which manufacturers are 

not able to increase per-unit operating 

profit in proportion to increases in 

MPCs. Under this scenario, as MPCs 

increase, manufacturers reduce their 

manufacturer margins to maintain a cost 

competitive offering in the market. 

However, in this scenario manufacturers 

maintain their total operating profit in 

absolute dollars in the standards case, 

despite higher product costs and 

investment. Therefore, gross margin (as 

a percentage) shrinks in the standards 

cases for this manufacturer markup 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87104 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

81Available at www.epa.gov/sites/production/ 

files/2021-04/documents/emission-factors_

apr2021.pdf (last accessed July 12, 2021). 

82For further information, see the Assumptions to 

AEO2023 report that sets forth the major 

assumptions used to generate the projections in the 

Annual Energy Outlook. Available at www.eia.gov/ 

outlooks/aeo/assumptions/ (last accessed May 1, 

2023). 

83CSAPR requires states to address annual 

emissions of SO2 and NOX, precursors to the 

formation of fine particulate matter (‘‘PM2.5’’) 

pollution, in order to address the interstate 

transport of pollution with respect to the 1997 and 

2006 PM2.5 National Ambient Air Quality Standards 

(‘‘NAAQS’’). CSAPR also requires certain states to 

address the ozone season (May-September) 

emissions of NOX, a precursor to the formation of 

ozone pollution, in order to address the interstate 

transport of ozone pollution with respect to the 

1997 ozone NAAQS. 76 FR 48208 (Aug. 8, 2011). 

EPA subsequently issued a supplemental rule that 

included an additional five states in the CSAPR 

ozone season program; 76 FR 80760 (Dec. 27, 2011) 

(Supplemental Rule), and EPA issued the CSAPR 

Update for the 2008 ozone NAAQS. 81 FR 74504 

(Oct. 26, 2016). 

84 In order to continue operating, coal power 

plants must have either flue gas desulfurization or 

dry sorbent injection systems installed. Both 

technologies, which are used to reduce acid gas 

emissions, also reduce SO2 emissions. 

scenario. This manufacturer markup 

scenario represents the lower-bound to 

industry profitability under new energy 

conservation standards. 

A comparison of industry financial 

impacts under the two markup 

scenarios is presented in section V.B.2.a 

of this document. 

3. Manufacturer Interviews 

DOE conducted additional interviews 

with manufacturers following the 

publication of the March 2022 

Preliminary TSD in preparation for this 

analysis. In interviews, DOE asked 

manufacturers to describe their major 

concerns regarding this rulemaking. The 

following section highlights 

manufacturer concerns that helped 

inform the projected potential impacts 

of new standards on the industry. 

Manufacturer interviews are conducted 

under NDAs, so DOE does not 

document these discussions in the same 

way that it does public comments in the 

comment summaries and DOE’s 

responses throughout the rest of this 

document. 

During these interviews, most 

manufacturers stated that they were 

concerned that if energy conservation 

standards were set at the higher ELs, 

ESEM manufacturers may have to 

increase the size and footprint of 

potentially non-compliant ESEM 

models to meet these higher ELs. While 

ESEM manufacturers stated it is 

possible for them to meet higher ELs by 

increasing the size or footprint of their 

ESEMs, many of the ESEMs that they 

manufacture are embedded or 

incorporated in another product or 

equipment. They further stated that 

several of these products or equipment 

with embedded ESEMs are not able to 

accommodate a larger ESEMs into these 

space-constrained products or 

equipment. 

As previously discussed, DOE revised 

the engineering analysis for this NOPR 

based on comments from the December 

2022 Joint Recommendation, to assume 

that ESEMs at EL 2 or below would not 

result in a significant increase in 

physical size. (See Electric Motors 

Working Group, No. 38 at p. 4) For ELs 

higher than EL 2 (i.e., EL 3 and EL 4), 

DOE recognizes that ESEMs may 

significantly increase in physical size in 

order to meet those higher efficiency 

requirements. DOE also recognizes that 

this may result in a significant 

disruption to the OEM market that used 

ESEMs as an embedded product. 

K. Emissions Analysis 

The emissions analysis consists of 

two components. The first component 

estimates the effect of potential energy 

conservation standards on power sector 

and site (where applicable) combustion 

emissions of CO2, NOX, SO2, and Hg. 

The second component estimates the 

impacts of potential standards on 

emissions of two additional greenhouse 

gases, CH4 and N2O, as well as the 

reductions in emissions of other gases 

due to ‘‘upstream’’ activities in the fuel 

production chain. These upstream 

activities comprise extraction, 

processing, and transporting fuels to the 

site of combustion. 

The analysis of electric power sector 

emissions of CO2, NOX, SO2, and Hg 

uses emissions intended to represent the 

marginal impacts of the change in 

electricity consumption associated with 

new standards. The methodology is 

based on results published for the AEO, 

including a set of side cases that 

implement a variety of efficiency-related 

policies. The methodology is described 

in appendix 13A in the NOPR TSD. The 

analysis presented in this notice uses 

projections from AEO2023. Power sector 

emissions of CH4 and N2O from fuel 

combustion are estimated using 

Emission Factors for Greenhouse Gas 

Inventories published by the EPA.81

FFC upstream emissions, which 

include emissions from fuel combustion 

during extraction, processing, and 

transportation of fuels, and ‘‘fugitive’’ 

emissions (direct leakage to the 

atmosphere) of CH4 and CO2, are 

estimated based on the methodology 

described in chapter 15 of the NOPR 

TSD. 

The emissions intensity factors are 

expressed in terms of physical units per 

MWh or MMBtu of site energy savings. 

For power sector emissions, specific 

emissions intensity factors are 

calculated by sector and end use. Total 

emissions reductions are estimated 

using the energy savings calculated in 

the national impact analysis. 

1. Air Quality Regulations Incorporated 

in DOE’s Analysis 

DOE’s no-new-standards case for the 

electric power sector reflects the AEO, 

which incorporates the projected 

impacts of existing air quality 

regulations on emissions. AEO2023 

reflects, to the extent possible, laws and 

regulations adopted through midNovember 2022, including the 

emissions control programs discussed in 

the following paragraphs the emissions 

control programs discussed in the 

following paragraphs, and the Inflation 

Reduction Act.82

SO2 emissions from affected electric 

generating units (‘‘EGUs’’) are subject to 

nationwide and regional emissions capand-trade programs. Title IV of the 

Clean Air Act sets an annual emissions 

cap on SO2 for affected EGUs in the 48 

contiguous States and the District of 

Columbia (‘‘DC’’). (42 U.S.C. 7651 et 

seq.) SO2 emissions from numerous 

States in the eastern half of the United 

States are also limited under the CrossState Air Pollution Rule (‘‘CSAPR’’). 76 

FR 48208 (Aug. 8, 2011). CSAPR 

requires these states to reduce certain 

emissions, including annual SO2

emissions, and went into effect as of 

January 1, 2015.83 The AEO 

incorporates implementation of CSAPR, 

including the update to the CSAPR 

ozone season program emission budgets 

and target dates issued in 2016. 81 FR 

74504 (Oct. 26, 2016). Compliance with 

CSAPR is flexible among EGUs and is 

enforced through the use of tradable 

emissions allowances. Under existing 

EPA regulations, for states subject to 

SO2 emissions limits under CSAPR, any 

excess SO2 emissions allowances 

resulting from the lower electricity 

demand caused by the adoption of an 

efficiency standard could be used to 

permit offsetting increases in SO2

emissions by another regulated EGU. 

However, beginning in 2016, SO2

emissions began to fall as a result of the 

Mercury and Air Toxics Standards 

(‘‘MATS’’) for power plants.84 77 FR 

9304 (Feb. 16, 2012). The final rule 

establishes power plant emission 

standards for mercury, acid gases, and 

non-mercury metallic toxic pollutants. 

Because of the emissions reductions 

under the MATS, it is unlikely that 

excess SO2 emissions allowances 

resulting from the lower electricity 

demand would be needed or used to 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87105 

85Marten, A.L., E.A. Kopits, C.W. Griffiths, S.C. 

Newbold, and A. Wolverton. Incremental CH4 and 

N2O mitigation benefits consistent with the US 

Government’s SC–CO2 estimates. Climate Policy. 

2015. 15(2): pp. 272–298. 

permit offsetting increases in SO2

emissions by another regulated EGU. 

Therefore, energy conservation 

standards that decrease electricity 

generation will generally reduce SO2

emissions. DOE estimated SO2

emissions reduction using emissions 

factors based on AEO2023. 

CSAPR also established limits on NOX

emissions for numerous states in the 

eastern half of the United States. Energy 

conservation standards would have 

little effect on NOX emissions in those 

states covered by CSAPR emissions 

limits if excess NOX emissions 

allowances resulting from the lower 

electricity demand could be used to 

permit offsetting increases in NOX

emissions from other EGUs. In such 

case, NOX emissions would remain near 

the limit even if electricity generation 

goes down. Depending on the 

configuration of the power sector in the 

different regions and the need for 

allowances, however, NOX emissions 

might not remain at the limit in the case 

of lower electricity demand. That would 

mean that standards might reduce NOX

emissions in covered states. Despite this 

possibility, DOE has chosen to be 

conservative in its analysis and has 

maintained the assumption that 

standards will not reduce NOX

emissions in states covered by CSAPR. 

Standards would be expected to reduce 

NOX emissions in the states not covered 

by CSAPR. DOE used AEO2023 data to 

derive NOX emissions factors for the 

group of states not covered by CSAPR. 

The MATS limit mercury emissions 

from power plants, but they do not 

include emissions caps and, as such, 

DOE’s energy conservation standards 

would be expected to slightly reduce Hg 

emissions. DOE estimated mercury 

emissions reduction using emissions 

factors based on AEO2023, which 

incorporates the MATS. 

L. Monetizing Emissions Impacts 

As part of the development of this 

NOPR, for the purpose of complying 

with the requirements of Executive 

Order 12866, DOE considered the 

estimated monetary benefits from the 

reduced emissions of CO2, CH4, N2O, 

NOX, and SO2 that are expected to result 

from each of the TSLs considered. In 

order to make this calculation analogous 

to the calculation of the NPV of 

consumer benefit, DOE considered the 

reduced emissions expected to result 

over the lifetime of equipment shipped 

in the projection period for each TSL. 

This section summarizes the basis for 

the values used for monetizing the 

emissions benefits and presents the 

values considered in this NOPR. 

To monetize the benefits of reducing 

GHG emissions, this analysis uses the 

interim estimates presented in the 

Technical Support Document: Social 

Cost of Carbon, Methane, and Nitrous 

Oxide Interim Estimates Under 

Executive Order 13990 published in 

February 2021 by the IWG. 

1. Monetization of Greenhouse Gas 

Emissions 

DOE estimates the monetized benefits 

of the reductions in emissions of CO2, 

CH4, and N2O by using a measure of the 

SC of each pollutant (e.g., SC–CO2). 

These estimates represent the monetary 

value of the net harm to society 

associated with a marginal increase in 

emissions of these pollutants in a given 

year, or the benefit of avoiding that 

increase. These estimates are intended 

to include (but are not limited to) 

climate-change-related changes in net 

agricultural productivity, human health, 

property damages from increased flood 

risk, disruption of energy systems, risk 

of conflict, environmental migration, 

and the value of ecosystem services. 

DOE exercises its own judgment in 

presenting monetized climate benefits 

as recommended by applicable 

Executive orders, and DOE would reach 

the same conclusion presented in this 

NOPR in the absence of the social cost 

of greenhouse gases. That is, the social 

costs of greenhouse gases, whether 

measured using the February 2021 

interim estimates presented by the 

Interagency Working Group on the 

Social Cost of Greenhouse Gases or by 

another means, did not affect this NOPR 

by DOE. 

DOE estimated the global social 

benefits of CO2, CH4, and N2O 

reductions using SC–GHG values that 

were based on the interim values 

presented in the Technical Support 

Document: Social Cost of Carbon, 

Methane, and Nitrous Oxide Interim 

Estimates under Executive Order 13990, 

published in February 2021 by the IWG. 

(‘‘February 2021 SC–GHG TSD’’) The 

SC–GHGs is the monetary value of the 

net harm to society associated with a 

marginal increase in emissions in a 

given year, or the benefit of avoiding 

that increase. In principle, SC–GHGs 

includes the value of all climate change 

impacts, including (but not limited to) 

changes in net agricultural productivity, 

human health effects, property damage 

from increased flood risk and natural 

disasters, disruption of energy systems, 

risk of conflict, environmental 

migration, and the value of ecosystem 

services. The SC–GHGs therefore, reflect 

the societal value of reducing emissions 

of the gas in question by one metric ton. 

The SC–GHGs is the theoretically 

appropriate value to use in conducting 

benefit-cost analyses of policies that 

affect CO2, N2O and CH4 emissions. As 

a member of the IWG involved in the 

development of the February 2021 SC– 

GHG TSD, DOE agrees that the interim 

SC–GHG estimates represent the most 

appropriate estimate of the SC–GHG 

until revised estimates have been 

developed reflecting the latest, peerreviewed science. 

The SC–GHGs estimates presented 

here were developed over many years, 

using transparent process, peerreviewed methodologies, the best 

science available at the time of that 

process, and with input from the public. 

Specifically, in 2009, the IWG, that 

included the DOE and other executive 

branch agencies and offices was 

established to ensure that agencies were 

using the best available science and to 

promote consistency in the social cost of 

carbon (‘‘SC–CO2’’) values used across 

agencies. The IWG published SC–CO2

estimates in 2010 that were developed 

from an ensemble of three widely cited 

integrated assessment models (‘‘IAMs’’) 

that estimate global climate damages 

using highly aggregated representations 

of climate processes and the global 

economy combined into a single 

modeling framework. The three IAMs 

were run using a common set of input 

assumptions in each model for future 

population, economic, and CO2

emissions growth, as well as 

equilibrium climate sensitivity—a 

measure of the globally averaged 

temperature response to increased 

atmospheric CO2 concentrations. These 

estimates were updated in 2013 based 

on new versions of each IAM. In August 

2016 the IWG published estimates of the 

social cost of methane (‘‘SC–CH4’’) and 

nitrous oxide (‘‘SC–N2O’’) using 

methodologies that are consistent with 

the methodology underlying the SC– 

CO2 estimates. The modeling approach 

that extends the IWG SC–CO2

methodology to non-CO2 GHGs has 

undergone multiple stages of peer 

review. The SC–CH4 and SC–N2O 

estimates were developed by Marten et 

al.85 and underwent a standard doubleblind peer review process prior to 

journal publication. In 2015, as part of 

the response to public comments 

received to a 2013 solicitation for 

comments on the SC–CO2 estimates, the 

IWG announced a National Academies 

of Sciences, Engineering, and Medicine 

review of the SC–CO2 estimates to offer 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87106 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

86National Academies of Sciences, Engineering, 

and Medicine. Valuing Climate Damages: Updating 

Estimation of the Social Cost of Carbon Dioxide. 

2017. The National Academies Press: Washington, 

DC. http://nap.nationalacademies.org/catalog/ 

24651/valuing-climate-damages-updatingestimation-of-the-social-cost-of. 

87 Interagency Working Group on Social Cost of 

Carbon. Social Cost of Carbon for Regulatory Impact 

Analysis under Executive Order 12866. 2010. 

United States Government. www.epa.gov/sites/ 

default/files/2016-12/documents/scc_tsd_2010.pdf 

(last accessed April 15, 2022); Interagency Working 

Group on Social Cost of Carbon. Technical Update 

of the Social Cost of Carbon for Regulatory Impact 

Analysis Under Executive Order 12866. 2013. 

www.federalregister.gov/documents/2013/11/26/ 

2013-28242/technical-support-document-technicalupdate-of-the-social-cost-of-carbon-for-regulatoryimpact (last accessed April 15, 2022); Interagency 

Working Group on Social Cost of Greenhouse Gases, 

United States Government. Technical Support 

Document: Technical Update on the Social Cost of 

Carbon for Regulatory Impact Analysis-Under 

Executive Order 12866. August 2016. www.epa.gov/ 

sites/default/files/2016-12/documents/sc_co2_tsd_

august_2016.pdf (last accessed January 18, 2022); 

Interagency Working Group on Social Cost of 

Greenhouse Gases, United States Government. 

Addendum to Technical Support Document on 

Social Cost of Carbon for Regulatory Impact 

Analysis under Executive Order 12866: Application 

of the Methodology to Estimate the Social Cost of 

Methane and the Social Cost of Nitrous Oxide. 

August 2016. www.epa.gov/sites/default/files/2016- 

12/documents/addendum_to_sc-ghg_tsd_august_

2016.pdf (last accessed January 18, 2022). 

advice on how to approach future 

updates to ensure that the estimates 

continue to reflect the best available 

science and methodologies. In January 

2017, the National Academies released 

their final report, Valuing Climate 

Damages: Updating Estimation of the 

Social Cost of Carbon Dioxide, and 

recommended specific criteria for future 

updates to the SC–CO2 estimates, a 

modeling framework to satisfy the 

specified criteria, and both near-term 

updates and longer-term research needs 

pertaining to various components of the 

estimation process.86 Shortly thereafter, 

in March 2017, President Trump issued 

Executive Order 13783, which 

disbanded the IWG, withdrew the 

previous TSDs, and directed agencies to 

ensure SC–CO2 estimates used in 

regulatory analyses are consistent with 

the guidance contained in OMB’s 

Circular A–4, ‘‘including with respect to 

the consideration of domestic versus 

international impacts and the 

consideration of appropriate discount 

rates’’ (E.O. 13783, Section 5(c)). 

Benefit-cost analyses following E.O. 

13783 used SC–GHG estimates that 

attempted to focus on the U.S.-specific 

share of climate change damages as 

estimated by the models and were 

calculated using two discount rates 

recommended by Circular A–4, 3 

percent and 7 percent. All other 

methodological decisions and model 

versions used in SC–GHG calculations 

remained the same as those used by the 

IWG in 2010 and 2013, respectively. 

On January 20, 2021, President Biden 

issued Executive Order 13990, which reestablished the IWG and directed it to 

ensure that the U.S. Government’s 

estimates of the social cost of carbon 

and other greenhouse gases reflect the 

best available science and the 

recommendations of in the National 

Academies 2017 report. The IWG was 

tasked with first reviewing the SC–GHG 

estimates currently used in Federal 

analyses and publishing interim 

estimates within 30 days of the E.O. that 

reflect the full impact of GHG 

emissions, including by taking global 

damages into account. The interim SC– 

GHG estimates published in February 

2021 are used here to estimate the 

climate benefits for this proposed 

rulemaking. The E.O. instructs the IWG 

to undertake a fuller update of the SC– 

GHG estimates that takes into 

consideration the advice in the National 

Academies 2017 report and other recent 

scientific literature. The February 2021 

SC–GHG TSD provides a complete 

discussion of the IWG’s initial review 

conducted under E.O. 13990. In 

particular, the IWG found that the SC– 

GHG estimates used under E.O. 13783 

fail to reflect the full impact of GHG 

emissions in multiple ways. 

First, the IWG found that the SC–GHG 

estimates used under E.O. 13783 fail to 

fully capture many climate impacts that 

affect the welfare of U.S. citizens and 

residents, and those impacts are better 

reflected by global measures of the SC– 

GHG. Examples of omitted effects from 

the E.O. 13783 estimates include direct 

effects on U.S. citizens, assets, and 

investments located abroad, supply 

chains, U.S. military assets and interests 

abroad, and tourism, and spillover 

pathways such as economic and 

political destabilization and global 

migration that can lead to adverse 

impacts on U.S. national security, 

public health, and humanitarian 

concerns. In addition, assessing the 

benefits of U.S. GHG mitigation 

activities requires consideration of how 

those actions may affect mitigation 

activities by other countries, as those 

international mitigation actions will 

provide a benefit to U.S. citizens and 

residents by mitigating climate impacts 

that affect U.S. citizens and residents. A 

wide range of scientific and economic 

experts have emphasized the issue of 

reciprocity as support for considering 

global damages of GHG emissions. If the 

United States does not consider impacts 

on other countries, it is difficult to 

convince other countries to consider the 

impacts of their emissions on the United 

States. The only way to achieve an 

efficient allocation of resources for 

emissions reduction on a global basis— 

and so benefit the U.S. and its citizens— 

is for all countries to base their policies 

on global estimates of damages. As a 

member of the IWG involved in the 

development of the February 2021 SC– 

GHG TSD, DOE agrees with this 

assessment and, therefore, in this NOPR, 

DOE centers attention on a global 

measure of SC–GHG. This approach is 

the same as that taken in DOE regulatory 

analyses from 2012 through 2016. A 

robust estimate of climate damages that 

accrue only to U.S. citizens and 

residents does not currently exist in the 

literature. As explained in the February 

SC–GHG 2021 TSD, existing estimates 

are both incomplete and an 

underestimate of total damages that 

accrue to the citizens and residents of 

the U.S. because they do not fully 

capture the regional interactions and 

spillovers discussed above, nor do they 

include all of the important physical, 

ecological, and economic impacts of 

climate change recognized in the 

climate change literature. As noted in 

the February 2021 SC–GHG TSD, the 

IWG will continue to review 

developments in the literature, 

including more robust methodologies 

for estimating a U.S.-specific SC–GHG 

value, and explore ways to better inform 

the public of the full range of carbon 

impacts. As a member of the IWG, DOE 

will continue to follow developments in 

the literature pertaining to this issue. 

Second, the IWG found that the use of 

the social rate of return on capital (7 

percent under current OMB Circular A– 

4 guidance) to discount the future 

benefits of reducing GHG emissions 

inappropriately underestimates the 

impacts of climate change for the 

purposes of estimating the SC–GHG. 

Consistent with the findings of the 

National Academies and the economic 

literature, the IWG continued to 

conclude that the consumption rate of 

interest is the theoretically appropriate 

discount rate in an intergenerational 

context,87 and recommended that 

discount rate uncertainty and relevant 

aspects of intergenerational ethical 

considerations be accounted for in 

selecting future discount rates. 

Furthermore, the damage estimates 

developed for use in the SC–GHG are 

estimated in consumption-equivalent 

terms, and so an application of OMB 

Circular A–4’s guidance for regulatory 

analysis would then use the 

consumption discount rate to calculate 

the SC–GHG. DOE agrees with this 

assessment and will continue to follow 

developments in the literature 

pertaining to this issue. DOE also notes 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87107 

88 Interagency Working Group on Social Cost of 

Greenhouse Gases (IWG). 2021. Technical Support 

Document: Social Cost of Carbon, Methane, and 

Nitrous Oxide Interim Estimates under Executive 

Order 13990. February. United States Government. 

Available at: www.whitehouse.gov/briefing-room/ 

blog/2021/02/26/a-return-to-science-evidencebased-estimates-of-the-benefits-of-reducing-climatepollution/. 

that while OMB Circular A–4, as 

published in 2003, recommends using 

3% and 7% discount rates as ‘‘default’’ 

values, Circular A–4 also reminds 

agencies that ‘‘different regulations may 

call for different emphases in the 

analysis, depending on the nature and 

complexity of the regulatory issues and 

the sensitivity of the benefit and cost 

estimates to the key assumptions.’’ On 

discounting, Circular A–4 recognizes 

that ‘‘special ethical considerations arise 

when comparing benefits and costs 

across generations,’’ and Circular A–4 

acknowledges that analyses may 

appropriately ‘‘discount future costs and 

consumption benefits . . . at a lower 

rate than for intragenerational analysis.’’ 

In the 2015 Response to Comments on 

the Social Cost of Carbon for Regulatory 

Impact Analysis, OMB, DOE, and the 

other IWG members recognized that 

‘‘Circular A–4 is a living document’’ and 

‘‘the use of 7 percent is not considered 

appropriate for intergenerational 

discounting. There is wide support for 

this view in the academic literature, and 

it is recognized in Circular A–4 itself.’’ 

Thus, DOE concludes that a 7% 

discount rate is not appropriate to apply 

to value the social cost of greenhouse 

gases in the analysis presented in this 

analysis. 

To calculate the present and 

annualized values of climate benefits, 

DOE uses the same discount rate as the 

rate used to discount the value of 

damages from future GHG emissions, for 

internal consistency. That approach to 

discounting follows the same approach 

that the February 2021 TSD 

recommends ‘‘to ensure internal 

consistency—i.e., future damages from 

climate change using the SC–GHG at 2.5 

percent should be discounted to the 

base year of the analysis using the same 

2.5 percent rate.’’ DOE has also 

consulted the National Academies’ 2017 

recommendations on how SC–GHG 

estimates can ‘‘be combined in RIAs 

with other cost and benefits estimates 

that may use different discount rates.’’ 

The National Academies reviewed 

several options, including ‘‘presenting 

all discount rate combinations of other 

costs and benefits with [SC–GHG] 

estimates.’’ 

As a member of the IWG involved in 

the development of the February 2021 

SC–GHG TSD, DOE agrees with the 

above assessment and will continue to 

follow developments in the literature 

pertaining to this issue. While the IWG 

works to assess how best to incorporate 

the latest, peer reviewed science to 

develop an updated set of SC–GHG 

estimates, it set the interim estimates to 

be the most recent estimates developed 

by the IWG prior to the group being 

disbanded in 2017. The estimates rely 

on the same models and harmonized 

inputs and are calculated using a range 

of discount rates. As explained in the 

February 2021 SC–GHG TSD, the IWG 

has recommended that agencies revert 

to the same set of four values drawn 

from the SC–GHG distributions based 

on three discount rates as were used in 

regulatory analyses between 2010 and 

2016 and were subject to public 

comment. For each discount rate, the 

IWG combined the distributions across 

models and socioeconomic emissions 

scenarios (applying equal weight to 

each) and then selected a set of four 

values recommended for use in benefitcost analyses: an average value resulting 

from the model runs for each of three 

discount rates (2.5 percent, 3 percent, 

and 5 percent), plus a fourth value, 

selected as the 95th percentile of 

estimates based on a 3 percent discount 

rate. The fourth value was included to 

provide information on potentially 

higher-than-expected economic impacts 

from climate change. As explained in 

the February 2021 SC–GHG TSD, and 

DOE agrees, this update reflects the 

immediate need to have an operational 

SC–GHG for use in regulatory benefitcost analyses and other applications that 

was developed using a transparent 

process, peer-reviewed methodologies, 

and the science available at the time of 

that process. Those estimates were 

subject to public comment in the 

context of dozens of proposed 

rulemakings as well as in a dedicated 

public comment period in 2013. 

There are a number of limitations and 

uncertainties associated with the SC– 

GHG estimates. First, the current 

scientific and economic understanding 

of discounting approaches suggests 

discount rates appropriate for 

intergenerational analysis in the context 

of climate change are likely to be less 

than 3 percent, near 2 percent or 

lower.88 Second, the IAMs used to 

produce these interim estimates do not 

include all of the important physical, 

ecological, and economic impacts of 

climate change recognized in the 

climate change literature and the 

science underlying their ‘‘damage 

functions’’—i.e., the core parts of the 

IAMs that map global mean temperature 

changes and other physical impacts of 

climate change into economic (both 

market and nonmarket) damages—lags 

behind the most recent research. For 

example, limitations include the 

incomplete treatment of catastrophic 

and non-catastrophic impacts in the 

integrated assessment models, their 

incomplete treatment of adaptation and 

technological change, the incomplete 

way in which inter-regional and 

intersectoral linkages are modeled, 

uncertainty in the extrapolation of 

damages to high temperatures, and 

inadequate representation of the 

relationship between the discount rate 

and uncertainty in economic growth 

over long time horizons. Likewise, the 

socioeconomic and emissions scenarios 

used as inputs to the models do not 

reflect new information from the last 

decade of scenario generation or the full 

range of projections. The modeling 

limitations do not all work in the same 

direction in terms of their influence on 

the SC–CO2 estimates. However, as 

discussed in the February 2021 TSD, the 

IWG has recommended that, taken 

together, the limitations suggest that the 

interim SC–GHG estimates used in this 

NOPR likely underestimate the damages 

from GHG emissions. DOE concurs with 

this assessment. 

DOE’s derivations of the SC–CO2, SC– 

N2O, and SC–CH4 values used for this 

NOPR are discussed in the following 

sections, and the results of DOE’s 

analyses estimating the benefits of the 

reductions in emissions of these GHGs 

are presented in section V.B.6 of this 

document. 

In response to the March 2022 

Preliminary Analysis, NEMA disagreed 

with DOE’s approach for estimating 

monetary benefits associated with 

emissions reductions. NEMA 

commented that this topic is too 

convoluted and subjective to be 

included in a rulemaking analysis for 

electric motor standards. NEMA added 

that DOE does not adequately examine 

or account for the significant impacts 

from ever-increasing investment in and 

use of renewable energy sources and 

associated decrease in emissions. 

(NEMA, No. 22 at p. 25) 

DOE acknowledges that increasing 

use of renewable electricity sources will 

reduce CO2 emissions and likely other 

emissions from the power sector faster 

than could have been expected when 

AEO2023 was prepared. Nevertheless, 

DOE has used AEO2023 for the 

purposes of quantifying emissions as 

DOE believes it continues to be the most 

appropriate projection at this time for 

such purposes. And to comply with the 

requirements of Executive Order 12866, 

DOE considered the estimated monetary 

benefits from the reduced emissions of 

CO2, CH4, N2O, NOX, and SO2 that are 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87108 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

89See EPA, Revised 2023 and Later Model Year 

Light-Duty Vehicle GHG Emissions Standards: 

Regulatory Impact Analysis, Washington, DC, 

December 2021. Available at nepis.epa.gov/Exe/ 

ZyPDF.cgi?Dockey=P1013ORN.pdf (last accessed 

February 21, 2023). 

90U.S. Environmental Protection Agency. 

Estimating the Benefit per Ton of Reducing 

Directly-Emitted PM2.5, PM2.5 Precursors and Ozone 

Precursors from 21 Sectors. www.epa.gov/benmap/ 

estimating-benefit-ton-reducing-directly-emittedpm25-pm25-precursors-and-ozone-precursors. 

expected to result from each of the TSLs 

considered. It is important to note that 

even a significant reduction in the 

emissions benefits projected in this 

NOPR would not change DOE’s decision 

about which standard levels to propose 

based on the December 2022 Joint 

Recommendation and DOE’s analysis. 

a. Social Cost of Carbon 

The SC–CO2 values used for this 

NOPR were based on the values 

developed for the IWG’s February 2021 

TSD, which are shown in Table IV–10 

in five-year increments from 2020 to 

2050. The set of annual values that DOE 

used, which was adapted from estimates 

published by EPA,89 is presented in 

Appendix 14A of the NOPR TSD. These 

estimates are based on methods, 

assumptions, and parameters identical 

to the estimates published by the IWG 

(which were based on EPA modeling) 

and include values for 2051 to 2070. 

TABLE IV–10—ANNUAL SC–CO2 VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2050 

[2020$ per metric ton CO2] 

Year 

Discount rate and statistic 

5% 

Average 

3% 

Average 

2.5% 

Average 

3% 

95th percentile 

2020 ................................................................................................................................... 14 51 76 152 

2025 ................................................................................................................................... 17 56 83 169 

2030 ................................................................................................................................... 19 62 89 187 

2035 ................................................................................................................................... 22 67 96 206 

2040 ................................................................................................................................... 25 73 103 225 

2045 ................................................................................................................................... 28 79 110 242 

2050 ................................................................................................................................... 32 85 116 260 

DOE multiplied the CO2 emissions 

reduction estimated for each year by the 

SC–CO2 value for that year in each of 

the four cases. DOE adjusted the values 

to 2022$ using the implicit price 

deflator for gross domestic product 

(‘‘GDP’’) from the Bureau of Economic 

Analysis. To calculate a present value of 

the stream of monetary values, DOE 

discounted the values in each of the 

four cases using the specific discount 

rate that had been used to obtain the 

SC–CO2 values in each case. 

b. Social Cost of Methane and Nitrous 

Oxide 

The SC–CH4 and SC–N2O values used 

for this NOPR were based on the values 

developed for the February 2021 TSD. 

Table IV–11 shows the updated sets of 

SC–CH4 and SC–N2O estimates from the 

latest interagency update in 5-year 

increments from 2020 to 2050. The full 

set of annual values used is presented 

in Appendix 14–A of the NOPR TSD. To 

capture the uncertainties involved in 

regulatory impact analysis, DOE has 

determined it is appropriate to include 

all four sets of SC–CH4 and SC–N2O 

values, as recommended by the IWG. 

DOE derived values after 2050 using the 

approach described above for the SC– 

CO2. 

TABLE IV–11—ANNUAL SC–CH4 AND SC–N2O VALUES FROM 2021 INTERAGENCY UPDATE, 2020–2050 

[2020$ per metric ton] 

Year 

SC–CH4 SC–N2O 

Discount rate and statistic Discount rate and statistic 

5% 

Average 

3% 

Average 

2.5% 

Average 

3% 

95th percentile 

5% 

Average 

3% 

Average 

2.5% 

Average 

3% 

95th percentile 

2020 ..................................... 670 1,500 2,000 3,900 5,800 18,000 27,000 48,000 

2025 ..................................... 800 1,700 2,200 4,500 6,800 21,000 30,000 54,000 

2030 ..................................... 940 2,000 2,500 5,200 7,800 23,000 33,000 60,000 

2035 ..................................... 1,100 2,200 2,800 6,000 9,000 25,000 36,000 67,000 

2040 ..................................... 1,300 2,500 3,100 6,700 10,000 28,000 39,000 74,000 

2045 ..................................... 1,500 2,800 3,500 7,500 12,000 30,000 42,000 81,000 

2050 ..................................... 1,700 3,100 3,800 8,200 13,000 33,000 45,000 88,000 

DOE multiplied the CH4 and N2O 

emissions reduction estimated for each 

year by the SC–CH4 and SC–N2O 

estimates for that year in each of the 

cases. DOE adjusted the values to 2022$ 

using the implicit price deflator for GDP 

from the Bureau of Economic Analysis. 

To calculate a present value of the 

stream of monetary values, DOE 

discounted the values in each of the 

cases using the specific discount rate 

that had been used to obtain the SC–CH4

and SC–N2O estimates in each case. 

2. Monetization of Other Emissions 

Impacts 

For this NOPR, DOE estimated the 

monetized value of NOX and SO2

emissions reductions from electricity 

generation using the latest benefit-perton estimates for that sector from the 

EPA’s Benefits Mapping and Analysis 

Program.90 DOE used EPA’s values for 

PM2.5-related benefits associated with 

NOX and SO2 and for ozone-related 

benefits associated with NOX for 2025, 

2030, and 2040, calculated with 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87109 

91See U.S. Department of Commerce—Bureau of 

Economic Analysis. Regional Multipliers: A User 

Handbook for the Regional Input-Output Modeling 

System (RIMS II). 1997. U.S. Government Printing 

Office: Washington, DC. Available at www.bea.gov/ 

scb/pdf/regional/perinc/meth/rims2.pdf (last 

accessed July 1, 2021). 

92Livingston, O.V., S.R. Bender, M.J. Scott, and 

R.W. Schultz. ImSET 4.0: Impact of Sector Energy 

Technologies Model Description and User Guide. 

2015. Pacific Northwest National Laboratory: 

Richland, WA. PNNL–24563. 

discount rates of 3 percent and 7 

percent. DOE used linear interpolation 

to define values for the years not given 

in the 2025 to 2040 period; for years 

beyond 2040, the values are held 

constant. DOE combined the EPA 

regional benefit-per-ton estimates with 

regional information on electricity 

consumption and emissions from 

AEO2023 to define weighted-average 

national values for NOX and SO2 (see 

appendix 14B of the NOPR TSD). 

DOE multiplied the site emissions 

reduction (in tons) in each year by the 

associated $/ton values, and then 

discounted each series using discount 

rates of 3 percent and 7 percent as 

appropriate. 

DOE requests comment on how to 

address the climate benefits and nonmonetized effects of the proposal. 

M. Utility Impact Analysis 

In the March 2022 Preliminary 

Analysis, DOE described the approach 

for conducting the utility impact 

analysis. See chapter 15 of the March 

2022 Preliminary TSD. In response, 

NEMA commented that the proposed 

approach for assessing utility impacts 

appears to be sufficient. (NEMA, No. 22 

at p. 25) In this NOPR, DOE continues 

to follow the same approach. 

The utility impact analysis estimates 

the changes in installed electrical 

capacity and generation projected to 

result for each considered TSL. The 

analysis is based on published output 

from the NEMS associated with 

AEO2023. NEMS produces the AEO 

Reference case, as well as a number of 

side cases that estimate the economywide impacts of changes to energy 

supply and demand. For the current 

analysis, impacts are quantified by 

comparing the levels of electricity sector 

generation, installed capacity, fuel 

consumption and emissions in the 

AEO2023 Reference case and various 

side cases. Details of the methodology 

are provided in the appendices to 

chapters 13 and 15 of the NOPR TSD. 

The output of this analysis is a set of 

time-dependent coefficients that capture 

the change in electricity generation, 

primary fuel consumption, installed 

capacity and power sector emissions 

due to a unit reduction in demand for 

a given end use. These coefficients are 

multiplied by the stream of electricity 

savings calculated in the NIA to provide 

estimates of selected utility impacts of 

potential new energy conservation 

standards. 

N. Employment Impact Analysis 

In the March 2022 Preliminary 

Analysis, DOE described the approach 

for conducting the employment impact 

analysis. See chapter 16 of the March 

2022 Preliminary TSD. In response, 

NEMA commented that the proposed 

approach for assessing national 

employment impacts appears to be 

sufficient. (NEMA, No. 22 at p. 25) In 

this NOPR, DOE continues to follow the 

same approach. 

DOE considers employment impacts 

in the domestic economy as one factor 

in selecting a proposed standard. 

Employment impacts from new energy 

conservation standards include both 

direct and indirect impacts. Direct 

employment impacts are any changes in 

the number of employees of 

manufacturers of the products subject to 

standards, their suppliers, and related 

service firms. The MIA addresses those 

impacts. Indirect employment impacts 

are changes in national employment 

that occur due to the shift in 

expenditures and capital investment 

caused by the purchase and operation of 

more-efficient appliances. Indirect 

employment impacts from standards 

consist of the net jobs created or 

eliminated in the national economy, 

other than in the manufacturing sector 

being regulated, caused by (1) reduced 

spending by consumers on energy, (2) 

reduced spending on new energy supply 

by the utility industry, (3) increased 

consumer spending on the products to 

which the new standards apply and 

other goods and services, and (4) the 

effects of those three factors throughout 

the economy. 

One method for assessing the possible 

effects on the demand for labor of such 

shifts in economic activity is to compare 

sector employment statistics developed 

by the Labor Department’s BLS. BLS 

regularly publishes its estimates of the 

number of jobs per million dollars of 

economic activity in different sectors of 

the economy, as well as the jobs created 

elsewhere in the economy by this same 

economic activity. Data from BLS 

indicate that expenditures in the utility 

sector generally create fewer jobs (both 

directly and indirectly) than 

expenditures in other sectors of the 

economy.91 There are many reasons for 

these differences, including wage 

differences and the fact that the utility 

sector is more capital-intensive and less 

labor-intensive than other sectors. 

Energy conservation standards have the 

effect of reducing consumer utility bills. 

Because reduced consumer 

expenditures for energy likely lead to 

increased expenditures in other sectors 

of the economy, the general effect of 

efficiency standards is to shift economic 

activity from a less labor-intensive 

sector (i.e., the utility sector) to more 

labor-intensive sectors (e.g., the retail 

and service sectors). Thus, the BLS data 

suggest that net national employment 

may increase due to shifts in economic 

activity resulting from energy 

conservation standards. 

DOE estimated indirect national 

employment impacts for the standard 

levels considered in this NOPR using an 

input/output model of the U.S. economy 

called Impact of Sector Energy 

Technologies version 4 (‘‘ImSET’’).92

ImSET is a special-purpose version of 

the ‘‘U.S. Benchmark National InputOutput’’ (‘‘I–O’’) model, which was 

designed to estimate the national 

employment and income effects of 

energy-saving technologies. The ImSET 

software includes a computer- based I– 

O model having structural coefficients 

that characterize economic flows among 

187 sectors most relevant to industrial, 

commercial, and residential building 

energy use. 

DOE notes that ImSET is not a general 

equilibrium forecasting model, and that 

the uncertainties involved in projecting 

employment impacts, especially 

changes in the later years of the 

analysis. Because ImSET does not 

incorporate price changes, the 

employment effects predicted by ImSET 

may over-estimate actual job impacts 

over the long run for this proposed rule. 

Therefore, DOE used ImSET only to 

generate results for near-term 

timeframes (2034), where these 

uncertainties are reduced. For more 

details on the employment impact 

analysis, see chapter 16 of the NOPR 

TSD. 

V. Analytical Results and Conclusions 

The following section addresses the 

results from DOE’s analyses with 

respect to the considered energy 

conservation standards for ESEMs. It 

addresses the TSLs examined by DOE, 

the projected impacts of each of these 

levels if adopted as energy conservation 

standards for ESEMs, and the standards 

levels that DOE is proposing to adopt in 

this NOPR. Additional details regarding 

DOE’s analyses are contained in the 

NOPR TSD supporting this document. 

A. Trial Standard Levels 

In general, DOE typically evaluates 

potential new standards for products 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87110 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

93Results by efficiency level are presented in 

chapters 8, 10, and 12 of the NOPR TSD. 

94Efficiency levels that were analyzed for this 

NOPR are discussed in section IV.C.4 of this 

document. Results by efficiency level are presented 

in chapters 8, 10, and 12 of the NOPR TSD. 

and equipment by grouping individual 

efficiency levels for each class into 

TSLs. Use of TSLs allows DOE to 

identify and consider manufacturer cost 

interactions between the equipment 

classes, to the extent that there are such 

interactions, and price elasticity of 

consumer purchasing decisions that 

may change when different standard 

levels are set. 

In the analysis conducted for this 

NOPR, DOE analyzed the benefits and 

burdens of four TSLs for ESEMs. DOE 

developed TSLs that combine efficiency 

levels for each analyzed equipment 

class. DOE presents the results for the 

TSLs in this document, while the results 

for all efficiency levels that DOE 

analyzed are in the NOPR TSD.93

Table V–1 presents the TSLs and the 

corresponding efficiency levels that 

DOE has identified for potential new 

energy conservation standards for 

ESEMs. TSL 4 represents the maximum 

technologically feasible (‘‘max-tech’’) 

energy efficiency for all equipment 

classes. TSL 3 is equivalent to EL 3 for 

all equipment classes. TSL 2 is 

equivalent to EL 2 for all equipment 

classes and corresponds to the Electric 

Motors Working Group recommended 

levels. TSL 1 is equivalent to EL 1 for 

all equipment classes. 

TABLE V–1—TRIAL STANDARD LEVELS FOR ESEMS

Equipment class group Horsepower range 

TSL1 TSL2 TSL3 TSL4 

Average of 

EL0 and 

EL2 

Recommended 

levels 

Average of 

EL2 and 

EL4 

Max-tech 

ESEM High/Med Torque ............................................................ 0.25 ≤ hp ≤ 0.50 .... EL1 ............. EL2 ................ EL3 ............. EL4. 

0.5 < hp ≤ 3 ........... EL1 ............. EL2 ................ EL3 ............. EL4. 

ESEM Low Torque .................................................................... 0.25 hp ................... EL1 ............. EL2 ................ EL3 ............. EL4. 

0.25 < hp ............... EL1 ............. EL2 ................ EL3 ............. EL4. 

ESEM Polyphase ....................................................................... 0.25 ≤ hp ................ EL1 ............. EL2 ................ EL3 ............. EL4. 

AO–ESEM High/Med Torque .................................................... 0.25 ≤ hp ≤ 0.50 .... EL1 ............. EL2 ................ EL3 ............. EL4. 

0.5 < hp ≤ 3 ........... EL1 ............. EL2 ................ EL3 ............. EL4. 

AO–ESEM Low Torque ............................................................. 0.25 hp ................... EL1 ............. EL2 ................ EL3 ............. EL4. 

0.25 < hp ............... EL1 ............. EL2 ................ EL3 ............. EL4. 

AO–ESEM Polyphase ............................................................... 0.25 ≤ hp ................ EL1 ............. EL2 ................ EL3 ............. EL4. 

DOE constructed the TSLs for this 

NOPR to include ELs representative of 

ELs with similar characteristics (i.e., 

using similar efficiencies). Specifically, 

DOE aligned the efficiency levels for airover and non-air-over ESEMs because of 

the similarities in the manufacturing 

processes between air-over and non-airover ESEMs. In some cases, an AO– 

ESEM could be manufactured on the 

same line as a non-air-over ESEM by 

omitting the steps of manufacturing 

associated with the fan of a motor. DOE 

notes this alignment is in line with 

Electric Motors Working Group’s 

recommendation in the December 2022 

Joint Recommendation. While 

representative ELs were included in the 

TSLs, DOE considered all efficiency 

levels as part of its analysis.94

B. Economic Justification and Energy 

Savings 

1. Economic Impacts on Individual 

Consumers 

DOE analyzed the economic impacts 

on ESEM consumers by looking at the 

effects that potential ESEM standards at 

each TSL would have on the LCC and 

PBP. DOE also examined the impacts of 

potential standards on selected 

consumer subgroups. These analyses are 

discussed in the following sections. 

a. Life-Cycle Cost and Payback Period 

In general, higher-efficiency 

equipment affect consumers in two 

ways: (1) purchase price increases and 

(2) annual operating costs decrease. 

Inputs used for calculating the LCC and 

PBP include total installed costs (i.e., 

equipment price plus installation costs), 

and operating costs (i.e., annual energy 

use, energy prices, energy price trends, 

repair costs, and maintenance costs). 

The LCC calculation also uses 

equipment lifetime and a discount rate. 

Chapter 8 of the NOPR TSD provides 

detailed information on the LCC and 

PBP analyses. 

Table V–2 through Table V–21 show 

the LCC and PBP results for the TSLs 

considered for each equipment class. In 

the first of each pair of tables, the 

simple payback is measured relative to 

the baseline product. In the second 

table, the impacts are measured relative 

to the efficiency distribution in the nonew-standards case in the compliance 

year (see section IV.F.8 of this 

document). Because some consumers 

purchase equipment with higher 

efficiency in the no-new-standards case, 

the average savings are less than the 

difference between the average LCC of 

the baseline equipment and the average 

LCC at each TSL. The savings refer only 

to consumers who are affected by a 

standard at a given TSL. Those who 

already purchase an equipment with 

efficiency at or above a given TSL are 

not affected. Consumers for whom the 

LCC increases at a given TSL experience 

a net cost. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87111 

TABLE V–2—AVERAGE LCC AND PBP RESULTS FOR ESEM—HIGH/MED TORQUE, 0.25 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 186 98 509 696 .................... 7.7 

1 ............................................................. 1 ................... 192 86 447 639 0.5 7.7 

2 ............................................................. 2 ................... 211 76 397 607 1.1 7.7 

3 ............................................................. 3 ................... 296 68 354 649 3.7 7.7 

4 ............................................................. 4 ................... 434 62 322 755 6.9 7.7 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 

TABLE V–3—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR ESEM—HIGH/MED TORQUE, 

0.25 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022) 

1 ....................................................................................................... 1 2.0 56 

2 ....................................................................................................... 2 16.7 51 

3 ....................................................................................................... 3 51.2 ¥1 

4 ....................................................................................................... 4 85.9 ¥107 

* The savings represent the average LCC for affected consumers. 

TABLE V–4—AVERAGE LCC AND PBP RESULTS FOR ESEM—HIGH/MED TORQUE, 1 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 351 243 1,272 1,624 .................... 7.5 

1 ............................................................. 1 ................... 368 218 1,142 1,510 0.7 7.5 

2 ............................................................. 2 ................... 395 196 1,028 1,423 0.9 7.5 

3 ............................................................. 3 ................... 534 189 989 1,522 3.4 7.5 

4 ............................................................. 4 ................... 733 183 955 1,688 6.3 7.5 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 

TABLE V–5—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR ESEM—HIGH/MED TORQUE, 

1 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022) 

1 ....................................................................................................... 1 3.5 116 

2 ....................................................................................................... 2 11.7 138 

3 ....................................................................................................... 3 53.5 21 

4 ....................................................................................................... 4 82.5 ¥145 

* The savings represent the average LCC for affected consumers. 

TABLE V–6—AVERAGE LCC AND PBP RESULTS FOR ESEM—LOW TORQUE, 0.25 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 153 216 956 1,108 .................... 6.8 

1 ............................................................. 1 ................... 174 163 718 892 0.4 6.8 

2 ............................................................. 2 ................... 213 131 576 789 0.7 6.8 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87112 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE V–6—AVERAGE LCC AND PBP RESULTS FOR ESEM—LOW TORQUE, 0.25 hp—Continued 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

3 ............................................................. 3 ................... 277 118 518 795 1.3 6.8 

4 ............................................................. 4 ................... 366 107 470 836 2.0 6.8 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 

TABLE V–7—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR ESEM—LOW TORQUE, 0.25 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022) 

1 ....................................................................................................... 1 0.2 213 

2 ....................................................................................................... 2 2.9 147 

3 ....................................................................................................... 3 52.0 24 

4 ....................................................................................................... 4 67.7 ¥17 

* The savings represent the average LCC for affected consumers. 

TABLE V–8—AVERAGE LCC AND PBP RESULTS FOR ESEM—LOW TORQUE, 0.5 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 223 237 1,074 1,297 .................... 6.9 

1 ............................................................. 1 ................... 269 218 987 1,256 2.4 6.9 

2 ............................................................. 2 ................... 276 201 908 1,184 1.5 6.9 

3 ............................................................. 3 ................... 372 178 805 1,177 2.5 6.9 

4 ............................................................. 4 ................... 455 159 719 1,174 3.0 6.9 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 

TABLE V–9—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR ESEM—LOW TORQUE, 0.5 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022) 

1 ....................................................................................................... 1 10.8 41 

2 ....................................................................................................... 2 7.8 100 

3 ....................................................................................................... 3 30.4 78 

4 ....................................................................................................... 4 40.1 73 

* The savings represent the average LCC for affected consumers. 

TABLE V–10—AVERAGE LCC AND PBP RESULTS FOR ESEM—POLYPHASE TORQUE, 0.25 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 199 68 432 631 .................... 9.3 

1 ............................................................. 1 ................... 206 62 394 600 1.2 9.3 

2 ............................................................. 2 ................... 222 57 362 584 2.0 9.3 

3 ............................................................. 3 ................... 277 51 325 602 4.6 9.3 

4 ............................................................. 4 ................... 405 47 297 702 9.7 9.3 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87113 

TABLE V–11—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR ESEM—POLYPHASE, 0.25 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022) 

1 ....................................................................................................... 1 1.0 32 

2 ....................................................................................................... 2 7.2 26 

3 ....................................................................................................... 3 58.6 ¥8 

4 ....................................................................................................... 4 95.0 ¥107 

* The savings represent the average LCC for affected consumers. 

TABLE V–12—AVERAGE LCC AND PBP RESULTS FOR AO–ESEM—HIGH/MED TORQUE, 0.25 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 174 158 695 869 .................... 6.8 

1 ............................................................. 1 ................... 180 139 611 791 0.3 6.8 

2 ............................................................. 2 ................... 200 123 543 743 0.8 6.8 

3 ............................................................. 3 ................... 282 110 485 767 2.3 6.8 

4 ............................................................. 4 ................... 419 101 444 863 4.3 6.8 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 

TABLE V–13—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR AO–ESEM—HIGH/MED

TORQUE, 0.25 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022) 

1 ....................................................................................................... 1 1.3 76 

2 ....................................................................................................... 2 7.8 83 

3 ....................................................................................................... 3 36.0 37 

4 ....................................................................................................... 4 64.6 ¥61 

* The savings represent the average LCC for affected consumers. 

TABLE V–14—AVERAGE LCC AND PBP RESULTS FOR AO–ESEM—HIGH/MED TORQUE, 1 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 338 312 1,492 1,830 .................... 7.0 

1 ............................................................. 1 ................... 355 283 1,352 1,707 0.6 7.0 

2 ............................................................. 2 ................... 382 255 1,219 1,601 0.8 7.0 

3 ............................................................. 3 ................... 520 246 1,173 1,693 2.7 7.0 

4 ............................................................. 4 ................... 716 238 1,138 1,854 5.1 7.0 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 

TABLE V–15—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR AO–ESEM—HIGH/MED

TORQUE, 1 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022) 

1 ....................................................................................................... 1 2.0 122 

2 ....................................................................................................... 2 5.9 160 

3 ....................................................................................................... 3 44.4 37 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87114 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE V–15—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR AO–ESEM—HIGH/MED

TORQUE, 1 hp—Continued 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022) 

4 ....................................................................................................... 4 81.9 ¥128 

* The savings represent the average LCC for affected consumers. 

TABLE V–16—AVERAGE LCC AND PBP RESULTS FOR AO–ESEM—LOW TORQUE, 0.25 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 141 218 962 1,103 .................... 6.8 

1 ............................................................. 1 ................... 163 164 722 885 0.4 6.8 

2 ............................................................. 2 ................... 202 132 579 781 0.7 6.8 

3 ............................................................. 3 ................... 264 119 521 785 1.2 6.8 

4 ............................................................. 4 ................... 352 108 472 824 1.9 6.8 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 

TABLE V–17—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR AO–ESEM—LOW TORQUE, 

0.25 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022$) 

1 ....................................................................................................... 1 0.1 217 

2 ....................................................................................................... 2 3.7 121 

3 ....................................................................................................... 3 39.1 32 

4 ....................................................................................................... 4 67.9 ¥13 

* The savings represent the average LCC for affected consumers. 

TABLE V–18—AVERAGE LCC AND PBP RESULTS FOR AO–ESEM—LOW TORQUE, 0.5 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 213 257 1,144 1,357 .................... 6.8 

1 ............................................................. 1 ................... 257 237 1,053 1,310 2.2 6.8 

2 ............................................................. 2 ................... 265 218 969 1,234 1.3 6.8 

3 ............................................................. 3 ................... 358 194 860 1,218 2.3 6.8 

4 ............................................................. 4 ................... 441 174 770 1,211 2.7 6.8 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 

TABLE V–19—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR AO–ESEM—LOW TORQUE, 

0.5 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022$) 

1 ....................................................................................................... 1 2.1 48 

2 ....................................................................................................... 2 2.9 88 

3 ....................................................................................................... 3 34.4 50 

4 ....................................................................................................... 4 42.2 52 

* The savings represent the average LCC for affected consumers. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87115 

95All representative units except for the ESEM 

Polyphase and AO–ESEM Polyphase, 0.5 hp are 

used in the residential sector. 

TABLE V–20—AVERAGE LCC AND PBP RESULTS FOR AO–ESEM—POLYPHASE, 0.25 hp 

TSL Efficiency 

level 

Average costs 

(2022$) Simple 

payback 

(years) 

Average 

lifetime 

Installed (years) 

cost 

First year’s 

operating 

cost 

Lifetime 

operating 

cost 

LCC 

Baseline ....... 189 81 488 678 .................... 8.9 

1 ............................................................. 1 ................... 197 74 446 643 1.1 8.9 

2 ............................................................. 2 ................... 212 68 411 623 1.8 8.9 

3 ............................................................. 3 ................... 267 61 369 636 3.9 8.9 

4 ............................................................. 4 ................... 394 56 340 734 8.3 8.9 

Note: The results for each TSL are calculated assuming that all consumers use products at that efficiency level. The PBP is measured relative 

to the baseline product. 

TABLE V–21—AVERAGE LCC SAVINGS RELATIVE TO THE NO-NEW-STANDARDS CASE FOR AO–ESEM—POLYPHASE, 

0.25 hp 

TSL Efficiency 

level 

Life-cycle cost savings 

Percent of consumers that 

experience net cost 

Average LCC savings * 

(2022$) 

1 ....................................................................................................... 1 2.7 35 

2 ....................................................................................................... 2 9.7 40 

3 ....................................................................................................... 3 48.6 13 

4 ....................................................................................................... 4 87.8 ¥85 

* The savings represent the average LCC for affected consumers. 

b. Consumer Subgroup Analysis 

In the consumer subgroup analysis, 

DOE estimated the impact of the 

considered TSLs on low-income 

households (for representative units 

with consumers in the residential 

sector 95), senior-only households (for 

representative units with consumers in 

the residential sector), and small 

businesses. Table V–22 to Table V–24 

compare the average LCC savings and 

PBP at each efficiency level for the 

consumer subgroups with similar 

metrics for the entire consumer sample 

for all equipment classes. In most cases, 

the average LCC savings and PBP for 

low-income households, senior-only 

household, and small-businesses at the 

considered efficiency levels are not 

substantially different from the average 

for all. Chapter 11 of the NOPR TSD 

presents the complete LCC and PBP 

results for the subgroups. 

TABLE V–22—COMPARISON OF LCC SAVINGS AND PBP FOR LOW-INCOME HOUSEHOLD SUBGROUP AND ALL CONSUMERS

TSL 

Average LCC 

savings * 

(2021$) 

Simple payback 

(years) 

Consumers with 

net benefit 

(%) 

Consumers with 

net cost 

(%) 

Lowincome All 

Lowincome All Lowincome All Lowincome All 

ESEM—High/Med Torque, 0.25 hp 

1 ....................................................................... 56 56 0.5 0.5 22.3 22.5 1.7 2.0 

2 ....................................................................... 53 51 1.4 1.5 52.1 51.0 14.3 16.7 

3 ....................................................................... 7 ¥1 4.9 5.3 36.1 32.4 45.9 51.2 

4 ....................................................................... ¥90 ¥107 9.2 10.0 19.7 13.6 77.9 85.9 

ESEM—High/Med Torque, 1 hp 

1 ....................................................................... 116 116 0.7 0.7 33.9 34.0 3.4 3.5 

2 ....................................................................... 138 138 1.0 1.1 74.4 74.2 11.1 11.7 

3 ....................................................................... 24 21 4.6 4.7 46.0 44.9 51.9 53.5 

4 ....................................................................... ¥138 ¥145 8.6 8.7 18.9 17.4 80.5 82.5 

ESEM—Low Torque, 0.25 hp 

1 ....................................................................... 210 213 0.4 0.4 3.9 4.0 0.2 0.2 

2 ....................................................................... 148 147 0.9 1.0 17.5 17.5 2.6 3.0 

3 ....................................................................... 29 24 3.1 3.3 50.2 48.0 48.1 52.0 

4 ....................................................................... ¥6 ¥17 4.6 5.0 35.7 32.3 62.6 67.7 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87116 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE V–22—COMPARISON OF LCC SAVINGS AND PBP FOR LOW-INCOME HOUSEHOLD SUBGROUP AND ALL

CONSUMERS—Continued 

TSL 

Average LCC 

savings * 

(2021$) 

Simple payback 

(years) 

Consumers with 

net benefit 

(%) 

Consumers with 

net cost 

(%) 

Lowincome All 

Lowincome All Lowincome All Lowincome All 

ESEM—Low Torque, 0.5 hp 

1 ....................................................................... 43 41 2.3 2.4 32.0 31.7 10.0 10.8 

2 ....................................................................... 101 100 1.2 1.3 56.2 56.2 7.1 7.8 

3 ....................................................................... 84 78 2.7 2.8 61.1 60.1 28.3 30.4 

4 ....................................................................... 82 73 3.2 3.3 61.0 59.9 37.7 40.1 

AO–ESEM—High/Med Torque, 0.25 hp 

1 ....................................................................... 77 76 0.3 0.3 25.1 25.5 1.2 1.3 

2 ....................................................................... 84 83 0.9 1.0 51.1 51.5 7.0 7.8 

3 ....................................................................... 44 37 3.0 3.2 44.6 43.0 32.8 36.0 

4 ....................................................................... ¥46 ¥61 5.7 6.1 25.7 21.8 59.1 64.6 

AO–ESEM—High/Med Torque, 1 hp 

1 ....................................................................... 122 122 0.6 0.6 30.5 30.6 2.0 2.0 

2 ....................................................................... 160 160 0.9 0.9 65.3 65.5 5.8 5.9 

3 ....................................................................... 39 37 3.9 3.9 44.3 44.0 43.8 44.4 

4 ....................................................................... ¥124 ¥128 7.6 7.7 18.8 18.1 80.9 81.9 

AO–ESEM—Low Torque, 0.25 hp 

1 ....................................................................... 220 217 0.4 0.4 1.6 1.7 0.1 0.1 

2 ....................................................................... 124 121 1.0 1.1 20.4 20.5 3.3 3.7 

3 ....................................................................... 36 32 2.9 3.1 45.0 43.2 36.1 39.1 

4 ....................................................................... ¥3 ¥13 4.6 4.9 35.7 32.1 62.7 67.9 

AO–ESEM—Low Torque, 0.5 hp 

1 ....................................................................... 51 48 2.1 2.2 7.1 7.0 2.0 2.2 

2 ....................................................................... 90 88 0.8 0.8 31.9 32.0 2.5 2.9 

3 ....................................................................... 56 50 2.8 3.0 58.0 56.7 31.5 34.4 

4 ....................................................................... 64 52 3.2 3.4 59.3 57.8 38.8 42.2 

TABLE V–23—COMPARISON OF LCC SAVINGS AND PBP FOR SENIOR-ONLY HOUSEHOLD SUBGROUP AND ALL

CONSUMERS

TSL 

Average LCC 

savings * 

(2021$) 

Simple payback 

(years) 

Consumers with 

net benefit 

(%) 

Consumers with 

net cost 

(%) 

Senioronly All 

Senioronly All Senioronly All Senioronly All 

ESEM—High/Med Torque, 0.25 hp 

1 ....................................................................... 56 56 0.5 0.5 22.4 22.5 2.1 2.0 

2 ....................................................................... 51 51 1.5 1.5 51.0 51.0 16.7 16.7 

3 ....................................................................... ¥1 ¥1 5.3 5.3 32.4 32.4 51.3 51.2 

4 ....................................................................... ¥107 ¥107 10.0 10.0 13.6 13.6 85.9 85.9 

ESEM—High/Med Torque hp 

1 ....................................................................... 116 116 0.7 0.7 34.0 34.0 3.5 3.5 

2 ....................................................................... 138 138 1.1 1.1 74.1 74.2 11.7 11.7 

3 ....................................................................... 21 21 4.7 4.7 44.8 44.9 53.6 53.5 

4 ....................................................................... ¥145 ¥145 8.7 8.7 17.4 17.4 82.5 82.5 

ESEM—Low Torque, 0.25 hp 

1 ....................................................................... 212 213 0.4 0.4 4.0 4.0 0.2 0.2 

2 ....................................................................... 146 147 1.0 1.0 17.5 17.5 3.0 3.0 

3 ....................................................................... 24 24 3.3 3.3 48.0 48.0 52.0 52.0 

4 ....................................................................... ¥17 ¥17 5.0 5.0 32.1 32.3 67.9 67.7 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87117 

TABLE V–23—COMPARISON OF LCC SAVINGS AND PBP FOR SENIOR-ONLY HOUSEHOLD SUBGROUP AND ALL

CONSUMERS—Continued 

TSL 

Average LCC 

savings * 

(2021$) 

Simple payback 

(years) 

Consumers with 

net benefit 

(%) 

Consumers with 

net cost 

(%) 

Senioronly All 

Senioronly All Senioronly All Senioronly All 

ESEM—Low Torque, 0.5 hp 

1 ....................................................................... 41 41 2.4 2.4 31.6 31.7 10.8 10.8 

2 ....................................................................... 99 100 1.3 1.3 56.2 56.2 7.8 7.8 

3 ....................................................................... 78 78 2.8 2.8 60.0 60.1 30.5 30.4 

4 ....................................................................... 72 73 3.3 3.3 59.8 59.9 40.2 40.1 

AO–ESEM—High/Med Torque, 0.25 hp 

1 ....................................................................... 76 76 0.3 0.3 25.5 25.5 1.3 1.3 

2 ....................................................................... 83 83 1.0 1.0 51.4 51.5 7.9 7.8 

3 ....................................................................... 37 37 3.2 3.2 42.9 43.0 36.1 36.0 

4 ....................................................................... ¥62 ¥61 6.1 6.1 21.7 21.8 64.7 64.6 

AO–ESEM—High/Med Torque, 1 hp 

1 ....................................................................... 122 122 0.6 0.6 30.6 30.6 2.0 2.0 

2 ....................................................................... 160 160 0.9 0.9 65.5 65.5 5.9 5.9 

3 ....................................................................... 37 37 3.9 3.9 44.0 44.0 44.4 44.4 

4 ....................................................................... ¥128 ¥128 7.7 7.7 18.1 18.1 81.9 81.9 

AO–ESEM—Low Torque, 0.25 hp 

1 ....................................................................... 216 217 0.4 0.4 1.7 1.7 0.1 0.1 

2 ....................................................................... 121 121 1.1 1.1 20.5 20.5 3.7 3.7 

3 ....................................................................... 31 32 3.1 3.1 43.2 43.2 39.2 39.1 

4 ....................................................................... ¥14 ¥13 4.9 4.9 32.1 32.1 67.9 67.9 

AO–ESEM—Low Torque, 0.5 hp 

1 ....................................................................... 47 48 2.2 2.2 7.0 7.0 2.1 2.2 

2 ....................................................................... 88 88 0.8 0.8 32.0 32.0 2.9 2.9 

3 ....................................................................... 50 50 3.0 3.0 56.7 56.7 34.5 34.4 

4 ....................................................................... 52 52 3.4 3.4 57.8 57.8 42.2 42.2 

TABLE V–24—COMPARISON OF LCC SAVINGS AND PBP FOR SMALL BUSINESS AND ALL CONSUMERS

TSL 

Average LCC 

savings * 

(2021$) 

Simple payback 

(years) 

Consumers with 

net benefit 

(%) 

Consumers with 

net cost 

(%) 

Small 

business All 

Small 

business All Small 

business All Small business All 

ESEM—High/Med Torque, 0.25 hp 

1 ....................................................................... 58 56 0.5 0.5 22.5 22.5 2.0 2.0 

2 ....................................................................... 54 51 1.4 1.5 51.2 51.0 16.5 16.7 

3 ....................................................................... 3 ¥1 4.9 5.3 33.8 32.4 49.9 51.2 

4 ....................................................................... ¥102 ¥107 9.3 10.0 15.2 13.6 84.3 85.9 

ESEM—High/Med Torque, 1 hp 

1 ....................................................................... 121 116 0.6 0.7 34.0 34.0 3.4 3.5 

2 ....................................................................... 145 138 1.0 1.1 74.4 74.2 11.5 11.7 

3 ....................................................................... 28 21 4.3 4.7 46.0 44.9 52.4 53.5 

4 ....................................................................... ¥136 ¥145 8.1 8.7 19.1 17.4 80.8 82.5 

ESEM—Low Torque, 0.25 hp 

1 ....................................................................... 220 213 0.4 0.4 4.0 4.0 0.2 0.2 

2 ....................................................................... 153 147 1.0 1.0 17.6 17.5 2.9 3.0 

3 ....................................................................... 27 24 3.2 3.3 50.6 48.0 49.4 52.0 

4 ....................................................................... ¥12 ¥17 4.7 5.0 34.6 32.3 65.4 67.7 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87118 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE V–24—COMPARISON OF LCC SAVINGS AND PBP FOR SMALL BUSINESS AND ALL CONSUMERS—Continued 

TSL 

Average LCC 

savings * 

(2021$) 

Simple payback 

(years) 

Consumers with 

net benefit 

(%) 

Consumers with 

net cost 

(%) 

Small 

business All 

Small 

business All Small 

business All Small business All 

ESEM—Low Torque, 0.5 hp 

1 ....................................................................... 44 41 2.3 2.4 32.0 31.7 10.5 10.8 

2 ....................................................................... 105 100 1.2 1.3 56.4 56.2 7.6 7.8 

3 ....................................................................... 85 78 2.6 2.8 61.1 60.1 29.4 30.4 

4 ....................................................................... 82 73 3.1 3.3 61.7 59.9 38.3 40.1 

ESEM—Polyphase, 0.5 hp 

1 ....................................................................... 33 32 1.0 1.1 9.3 9.2 1.0 1.0 

2 ....................................................................... 28 26 2.4 2.6 26.4 26.3 7.1 7.2 

3 ....................................................................... ¥7 ¥8 6.8 7.4 29.1 27.8 57.3 58.6 

4 ....................................................................... ¥105 ¥107 14.3 15.6 5.2 4.5 94.3 95.0 

AO–ESEM—High/Med Torque, 0.25 hp 

1 ....................................................................... 79 76 0.3 0.3 25.5 25.5 1.3 1.3 

2 ....................................................................... 86 83 0.9 1.0 51.6 51.5 7.7 7.8 

3 ....................................................................... 42 37 3.0 3.2 44.4 43.0 34.6 36.0 

4 ....................................................................... ¥56 ¥61 5.7 6.1 23.4 21.8 62.9 64.6 

AO–ESEM—High/Med Torque, 1 hp 

1 ....................................................................... 128 122 0.5 0.6 30.6 30.6 2.0 2.0 

2 ....................................................................... 168 160 0.8 0.9 65.6 65.5 5.8 5.9 

3 ....................................................................... 46 37 3.6 3.9 45.0 44.0 43.4 44.4 

4 ....................................................................... ¥119 ¥128 7.1 7.7 20.2 18.1 79.8 81.9 

AO–ESEM—Low Torque, 0.25 hp 

1 ....................................................................... 225 217 0.4 0.4 1.7 1.7 0.1 0.1 

2 ....................................................................... 127 121 1.0 1.1 20.6 20.5 3.7 3.7 

3 ....................................................................... 35 32 2.9 3.1 45.1 43.2 37.3 39.1 

4 ....................................................................... ¥9 ¥13 4.6 4.9 34.3 32.1 65.7 67.9 

AO–ESEM—Low Torque, 0.5 hp 

1 ....................................................................... 51 48 2.1 2.2 7.1 7.0 2.1 2.2 

2 ....................................................................... 92 88 0.8 0.8 32.1 32.0 2.8 2.9 

3 ....................................................................... 55 50 2.8 3.0 58.1 56.7 33.1 34.4 

4 ....................................................................... 60 52 3.3 3.4 59.7 57.8 40.3 42.2 

AO–ESEM—Polyphase, 0.5 hp 

1 ....................................................................... 37 35 1.0 1.1 33.8 33.7 2.6 2.7 

2 ....................................................................... 42 40 1.9 2.0 53.4 53.3 9.6 9.7 

3 ....................................................................... 16 13 4.7 5.1 50.1 48.8 47.3 48.6 

4 ....................................................................... ¥81 ¥85 9.9 10.8 13.9 12.2 86.1 87.8 

c. Rebuttable Presumption Payback 

As discussed in section IV.F.9 of this 

document, EPCA establishes a 

rebuttable presumption that an energy 

conservation standard is economically 

justified if the increased purchase cost 

for a product that meets the standard is 

less than three times the value of the 

first-year energy savings resulting from 

the standard. (42 U.S.C. 6316(a); 42 

U.S.C. 6295(o)(2)(B)(iii)) In calculating a 

rebuttable presumption payback period 

for each of the considered TSLs, DOE 

used discrete values, and, as required by 

EPCA, based the energy use calculation 

on the DOE test procedures for ESEMs. 

In contrast, the PBPs presented in 

section V.B.1.a of this document were 

calculated using distributions that 

reflect the range of energy use in the 

field. 

Table V–25 presents the rebuttablepresumption payback periods for the 

considered TSLs for ESEMs. While DOE 

examined the rebuttable-presumption 

criterion, it considered whether the 

standard levels considered for this 

proposed rule are economically justified 

through a more detailed analysis of the 

economic impacts of those levels, 

pursuant to 42 U.S.C. 6313(a) and 42 

U.S.C. 6295(o)(2)(B)(i), that considers 

the full range of impacts to the 

consumer, manufacturer, Nation, and 

environment. The results of that 

analysis serve as the basis for DOE to 

definitively evaluate the economic 

justification for a potential standard 

level, thereby supporting or rebutting 

the results of any preliminary 

determination of economic justification. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87119 

TABLE V–25—REBUTTABLE-PRESUMPTION PAYBACK PERIODS

Equipment class 

Payback period 

(years) 

TSL1 TSL2 TSL3 TSL4 

ESEM—High and Medium Torque, 0.25 hp .................................................... 0.4 1.0 3.1 5.8 

ESEM—High and Medium Torque, 1 hp ......................................................... 0.6 0.8 2.9 5.4 

ESEM—Low Torque, 0.25 hp .......................................................................... 0.4 0.7 1.2 1.8 

ESEM—Low Torque, 0.5 hp ............................................................................ 2.2 1.3 2.3 2.7 

ESEM—Polyphase, 0.25 hp ............................................................................ 1.0 1.7 3.9 8.3 

AO–ESEM—High and Medium Torque, 0.25 hp ............................................. 0.3 0.6 1.9 3.7 

AO–ESEM—High and Medium Torque, 1 hp .................................................. 0.5 0.7 2.4 4.4 

AO–ESEM—Low Torque, 0.25 hp .................................................................. 0.4 0.6 1.1 1.7 

AO–ESEM—Low Torque, 0.5 hp .................................................................... 2.0 1.2 2.1 2.5 

AO–ESEM—Polyphase, 0.25 hp ..................................................................... 0.9 1.5 3.4 7.1 

2. Economic Impacts on Manufacturers 

DOE performed an MIA to estimate 

the impact of new energy conservation 

standards on manufacturers of ESEM. 

The following section describes the 

expected impacts on manufacturers at 

each considered TSL. Chapter 12 of the 

NOPR TSD explains the analysis in 

further detail. 

a. Industry Cash Flow Analysis Results 

In this section, DOE provides GRIM 

results from the analysis, which 

examines changes in the industry that 

would result from new standards. The 

following tables summarize the 

estimated financial impacts (represented 

by changes in INPV) of potential new 

energy conservation standards on 

manufacturers of ESEMs, as well as the 

conversion costs that DOE estimates 

manufacturers of ESEMs would incur at 

each TSL. 

To evaluate the range of cash flow 

impacts on the ESEM industry, DOE 

modeled two manufacturer markup 

scenarios that correspond to the range of 

possible market responses to new 

standards. Each manufacturer markup 

scenario results in a unique set of cash 

flows and corresponding INPVs at each 

TSL. 

In the following discussion, the INPV 

results refer to the difference in industry 

value between the no-new-standards 

case and the standards cases that result 

from the sum of discounted cash flows 

from the base year (2024) through the 

end of the analysis period (2058). The 

results also discuss the difference in 

cash flows between the no-new 

standards case and the standards cases 

in the year before the estimated 

compliance date for new energy 

conservation standards. This figure 

represents the size of the required 

conversion costs relative to the cash 

flow generated by the ESEM industry in 

the absence of new energy conservation 

standards. 

To assess the upper (less severe) end 

of the range of potential impacts on 

ESEM manufacturers, DOE modeled a 

preservation of gross margin scenario. 

This scenario assumes that, in the 

standards cases, ESEM manufacturers 

will be able to pass along all the higher 

MPCs required for more efficient 

equipment to their customers. 

Specifically, the industry will be able to 

maintain its average no-new-standards 

case gross margin (as a percentage of 

revenue) despite the higher MPCs in the 

standards cases. In general, the larger 

the MPC increases, the less likely 

manufacturers are to achieve the cash 

flow from operations calculated in this 

scenario because it is less likely that 

manufacturers will be able to fully pass 

on these larger production cost 

increases. 

To assess the lower (more severe) end 

of the range of potential impacts on the 

ESEM manufacturers, DOE modeled a 

preservation of operating profit 

scenario. This scenario represents the 

lower end of the range of impacts on 

manufacturers because no additional 

operating profit is earned on the higher 

MPCs, eroding profit margins as a 

percentage of total revenue. 

TABLE V–26—INDUSTRY NET PRESENT VALUE FOR ESEM MANUFACTURERS—PRESERVATION OF GROSS MARGIN

SCENARIO

Units 

No-newstandards 

case 

Trial standard level * 

1 2 3 4 

INPV ......................................................................................... 2022$ millions ..... 2,019 1,883 1,888 1,820 1,710 

Change in INPV ....................................................................... 2022$ millions ..... .................. (136) (131) (199) (309) 

% ......................... .................. (6.7) (6.5) (9.9) (15.3) 

* Numbers may not sum exactly due to rounding. Numbers in parentheses are negative numbers. 

TABLE V–27—INDUSTRY NET PRESENT VALUE FOR ESEM MANUFACTURERS—PRESERVATION OF OPERATING PROFIT

SCENARIO

Units 

No-newstandards 

case 

Trial standard level * 

1 2 3 4 

INPV ......................................................................................... 2022$ millions ..... 2,019 1,818 1,755 1,035 73 

Change in INPV ....................................................................... 2022$ millions ..... .................. (201) (264) (984) (1,946) 

% ......................... .................. (9.9) (13.1) (48.7) (96.4) 

* Numbers may not sum exactly due to rounding. Numbers in parentheses are negative numbers. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87120 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE V–28—CASH FLOW ANALYSIS FOR ESEM MANUFACTURERS

Units 

No-newstandards 

case 

Trial standard level * 

1 2 3 4 

Free Cash Flow (2028) ............................................................ 2022$ millions ..... 154 45 17 (313) (764) 

Change in Free Cash Flow (2028) .......................................... 2022$ millions ..... .................. (110) (137) (468) (919) 

% ......................... .................. (71) (89) (303) (595) 

Product Conversion Costs ....................................................... 2022$ millions ..... .................. 125 141 326 572 

Capital Conversion Costs ........................................................ 2022$ millions ..... .................. 149 198 792 1,584 

Total Conversion Costs .................................................... 2022$ millions ..... .................. 274 339 1,118 2,156 

* Numbers may not sum exactly due to rounding. Numbers in parentheses are negative numbers. 

TSL 4 sets the efficiency level at EL 

4 for all ESEM equipment classes. At 

TSL 4, DOE estimates the impacts to 

INPV will range from a decrease of 

$1,946 million to a decrease of $309 

million, which represents decreases to 

INPV by approximately 96.4 percent 

and 15.3 percent, respectively. At TSL 

4, industry free cash flow (operating 

cash flow minus capital expenditures) is 

estimated to decrease to ¥$764 million, 

or a drop of 595 percent, compared to 

the no-new-standards case value of $154 

million in 2028, the year leading up to 

the compliance date of new energy 

conservation standards. The 

significantly negative free cash flow in 

the years leading up to the compliance 

date implies that most, if not all, ESEM 

manufacturers will need to borrow 

funds in order to make the investments 

necessary to comply with standards at 

TSL 4. This has the potential to 

significantly alter the market dynamics 

as some smaller ESEM manufacturers 

may not be able to secure this funding 

and could exit the market as a result of 

standards set at TSL 4. 

In the absence of new energy 

conservation standards, DOE estimates 

that less than 1 percent of ESEM (High/ 

Med Torque), no ESEM (Low Torque), 

less than 1 percent of ESEM 

(Polyphase), 6 percent of AO–ESEM 

(High/Med Torque), no AO–ESEM (Low 

Torque), and no AO–ESEM (Polyphase) 

shipments will meet the ELs required at 

TSL 4 in 2029, the compliance year of 

new standards. Therefore, DOE 

estimates that manufacturers will have 

to redesign models representing over 99 

percent of all ESEM shipments by the 

compliance date. It is unclear if most 

ESEM manufacturers would have the 

engineering capacity to complete the 

necessary redesigns within the 4-year 

compliance period. If manufacturers 

require more than 4 years to redesign 

their non-compliant ESEM models, they 

will likely prioritize redesigns based on 

sales volume, which could result in 

customers not being able to obtain 

compliant ESEMs covering the entire 

range of horsepower and motor 

configurations that they require. 

Almost all ESEMs covered by this 

rulemaking will need to be redesigned 

at TSL 4. Therefore, DOE estimates that 

manufacturers will have to make 

significant investments in their 

manufacturing production equipment 

and the engineering resources dedicated 

to redesigning ESEM models. DOE 

estimates that manufacturers will incur 

approximately $572 million in product 

conversion costs and approximately 

$1,584 million in capital conversion 

costs. Product conversion costs include 

the engineering time to redesign almost 

all ESEM models and to re-test these 

newly redesigned models to meet the 

standards set at TSL 4. Capital 

conversion costs include the purchase 

of almost all new lamination die sets, 

winding machines, frame casts, and 

assembly equipment as well as other 

retooling costs to accommodate almost 

all ESEM models covered by this 

proposed rulemaking that will need to 

be redesigned. 

At TSL 4, under the preservation of 

gross margin scenario, the shipment 

weighted average MPC significantly 

increases by approximately 117.7 

percent relative to the no-new-standards 

case MPC. While this price increase 

results in additional revenue for 

manufacturers, the $2,156 million in 

total conversion costs estimated at TSL 

4 outweighs this increase in 

manufacturer revenue and results in 

moderately negative INPV impacts at 

TSL 4 under the preservation of gross 

margin scenario. 

Under the preservation of operating 

profit scenario, manufacturers earn the 

same nominal operating profit as would 

be earned in the no-new-standards case, 

but manufacturers do not earn 

additional profit from their investments. 

The significant increase in the shipment 

weighted average MPC results in a lower 

average manufacturer margin. This 

lower average manufacturer margin and 

the significant $2,156 million in total 

conversion costs result in significantly 

negative INPV impacts at TSL 4 under 

the preservation of operating profit 

scenario. 

TSL 3 sets the efficiency level at EL 

3 for all ESEM equipment classes. At 

TSL 3, DOE estimates the impacts to 

INPV will range from a decrease of $984 

million to a decrease of $199 million, 

which represents decreases to INPV by 

approximately 48.7 percent and 9.9 

percent, respectively. At TSL 3, industry 

free cash flow is estimated to decrease 

to ¥$313 million, or a drop of 303 

percent, compared to the no-newstandards case value of $154 million in 

2028, the year leading up to the 

compliance date of new energy 

conservation standards. The negative 

free cash flow in the years leading up to 

the compliance date implies that most, 

if not all, ESEM manufacturers will 

need to borrow funds in order to make 

the investments necessary to comply 

with standards. This has the potential to 

significantly alter the market dynamics 

as some smaller ESEM manufacturers 

may not be able to secure this funding 

and could exit the market as a result of 

standards set at TSL 3. 

In the absence of new energy 

conservation standards, DOE estimates 

that 8 percent of ESEM (High/Med 

Torque), 8 percent of ESEM (Low 

Torque), 14 percent of ESEM 

(Polyphase), 15 percent of AO–ESEM 

(High/Med Torque), 11 percent of 

AOESEM (Low Torque), and 3 percent 

of AO–ESEM (Polyphase) shipments 

will meet or exceed the ELs requires at 

TSL 3 in 2029, the compliance year of 

new standards. Therefore, DOE 

estimates that manufacturers will have 

to redesign models representing 

approximately 91 percent of all ESEM 

shipments by the compliance date. It is 

unclear if most ESEM manufacturers 

would have the engineering capacity to 

complete the necessary redesigns within 

the 4-year compliance period. If 

manufacturers require more than 4 years 

to redesign their non-compliant ESEM 

models, they will likely prioritize 

redesigns based on sales volume, which 

could result in customers not being able 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87121 

to obtain compliant ESEMs covering the 

entire range of horsepower and motor 

configurations that they require. 

The majority of ESEMs covered by 

this rulemaking will need to be 

redesigned at TSL 3. Therefore, DOE 

estimates that manufacturers will have 

to make significant investments in their 

manufacturing production equipment 

and the engineering resources dedicated 

to redesigning ESEM models. DOE 

estimates that manufacturers will incur 

approximately $326 million in product 

conversion costs and approximately 

$792 million in capital conversion costs. 

Product conversion costs include the 

engineering time to redesign 

approximately 91 percent of all ESEM 

models and to re-test these newly 

redesigned models to meet the 

standards set at TSL 3. Capital 

conversion costs include the purchase 

of almost all new lamination die sets, 

winding machines, frame casts, and 

assembly equipment as well as other 

retooling costs for approximately 91 

percent of all ESEM models covered by 

this proposed rulemaking. 

At TSL 3, under the preservation of 

gross margin scenario, the shipment 

weighted average MPC significantly 

increases by approximately 56.4 percent 

relative to the no-new-standards case 

MPC. While this price increase results 

in additional revenue for manufacturers, 

the $1,118 million in total conversion 

costs estimated at TSL 3 outweighs this 

increase in manufacturer revenue and 

results in moderately negative INPV 

impacts at TSL 3 under the preservation 

of gross margin scenario. 

Under the preservation of operating 

profit scenario, manufacturers earn the 

same nominal operating profit as would 

be earned in the no-new-standards case, 

but manufacturers do not earn 

additional profit from their investments. 

The significant increase in the shipment 

weighted average MPC results in a lower 

average manufacturer margin. This 

lower average manufacturer margin and 

the significant $1,118 million in total 

conversion costs result in significantly 

negative INPV impacts at TSL 3 under 

the preservation of operating profit 

scenario. 

TSL 2 sets the efficiency level at EL 

2 for all ESEM equipment classes, 

which is the recommended level from 

the December 2022 Joint 

Recommendation. At TSL 2, DOE 

estimates the impacts to INPV will range 

from a decrease of $264 million to a 

decrease of $131 million, which 

represents decreases to INPV by 

approximately 13.1 percent and 6.5 

percent, respectively. At TSL 2, industry 

free cash flow is estimated to decrease 

to $17 million, or a drop of 89 percent, 

compared to the no-new-standards case 

value of $154 million in 2028, the year 

leading up to the compliance date of 

new energy conservation standards. 

In the absence of new energy 

conservation standards, DOE estimates 

that 22 percent of ESEM (High/Med 

Torque), 45 percent of ESEM (Low 

Torque), 67 percent of ESEM 

(Polyphase), 34 percent of AO–ESEM 

(High/Med Torque), 67 percent of AO– 

ESEM (Low Torque), and 36 percent of 

AO–ESEM (Polyphase) shipments will 

meet or exceed the ELs requires at TSL 

2 in 2029, the compliance year of new 

standards. Therefore, DOE estimates 

that manufacturers will have to redesign 

models representing approximately 55 

percent of all ESEM shipments by the 

compliance date. 

DOE estimates that manufacturers 

will incur approximately $141 million 

in product conversion costs and 

approximately $198 million in capital 

conversion costs. Product conversion 

costs primarily include engineering time 

to redesign non-compliance ESEM 

models and to re-test these newly 

redesigned models to meet the 

standards set at TSL 2. Capital 

conversion costs include the purchase 

of lamination die sets, winding 

machines, frame casts, and assembly 

equipment as well as other retooling 

costs for all non-compliant ESEM 

models covered by this proposed 

rulemaking. 

At TSL 2, under the preservation of 

gross margin scenario, the shipment 

weighted average MPC increases by 

approximately 9.6 percent relative to the 

no-new-standards case MPC. While this 

price increase results in additional 

revenue for manufacturers, the $339 

million in total conversion costs 

estimated at TSL 2 outweighs this 

increase in manufacturer revenue and 

results in moderately negative INPV 

impacts at TSL 2 under the preservation 

of gross margin scenario. 

Under the preservation of operating 

profit scenario, manufacturers earn the 

same nominal operating profit as would 

be earned in the no-new-standards case, 

but manufacturers do not earn 

additional profit from their investments. 

The increase in the shipment weighted 

average MPC results in a slightly lower 

average manufacturer margin. This 

lower average manufacturer margin and 

the $339 million in total conversion 

costs result in moderately negative INPV 

impacts at TSL 2 under the preservation 

of operating profit scenario. 

TSL 1 sets the efficiency level at EL 

1 for all ESEM equipment classes. At 

TSL 1, DOE estimates the impacts to 

INPV will range from a decrease of $201 

million to a decrease of $136 million, 

which represents decreases to INPV by 

approximately 9.9 percent and 6.7 

percent, respectively. At TSL 1, industry 

free cash flow is estimated to decrease 

to $45 million, or a drop of 71 percent, 

compared to the no-new-standards case 

value of $154 million in 2028, the year 

leading up to the compliance date of 

new energy conservation standards. 

In the absence of new energy 

conservation standards, DOE estimates 

that 68 percent of ESEM (High/Med 

Torque), 66 percent of ESEM (Low 

Torque), 90 percent of ESEM 

(Polyphase), 70 percent of AO–ESEM 

(High/Med Torque), 92 percent of AO– 

ESEM (Low Torque), and 62 percent of 

AO–ESEM (Polyphase) shipments will 

meet or exceed the ELs requires at TSL 

1 in 2029, the compliance year of new 

standards. Therefore, DOE estimates 

that manufacturers will have to redesign 

models representing approximately 26 

percent of all ESEM shipments by the 

compliance date. 

DOE estimates that manufacturers 

will incur approximately $125 million 

in product conversion costs and 

approximately $149 million in capital 

conversion costs. Product conversion 

costs primarily include engineering time 

to redesign non-compliance ESEM 

models and to re-test these newly 

redesigned models to meet the 

standards set at TSL 1. Capital 

conversion costs include the purchase 

of lamination die sets, winding 

machines, frame casts, and assembly 

equipment, as well as other retooling 

costs for all non-compliant ESEM 

models covered by this proposed 

rulemaking. 

At TSL 1, under the preservation of 

gross margin scenario, the shipment 

weighted average MPC increases slightly 

by approximately 4.7 percent relative to 

the no-new-standards case MPC. While 

this price increase results in additional 

revenue for manufacturers, the $274 

million in total conversion costs 

estimated at TSL 1 outweighs this 

increase in manufacturer revenue and 

results in moderately negative INPV 

impacts at TSL 1 under the preservation 

of gross margin scenario. 

Under the preservation of operating 

profit scenario, manufacturers earn the 

same nominal operating profit as would 

be earned in the no-new-standards case, 

but manufacturers do not earn 

additional profit from their investments. 

The increase in the shipment weighted 

average MPC results in a slightly lower 

average manufacturer margin. This 

lower average manufacturer margin and 

the $274 million in total conversion 

costs result in moderately negative INPV 

impacts at TSL 1 under the preservation 

of operating profit scenario. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87122 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

96Except for TSL 4, which has an MPC increase 

of higher than 100 percent. Therefore, DOE assumes 

all domestic employment moves abroad at this TSL. 

b. Direct Impacts on Employment 

To quantitatively assess the potential 

impacts of new energy conservation 

standards on direct employment in the 

ESEM industry, DOE used the GRIM to 

estimate the domestic labor 

expenditures and number of direct 

employees in the no-new-standards case 

and in each of the standards cases 

during the analysis period. 

DOE used statistical data from the 

U.S. Census Bureau’s 2021 Annual 

Survey of Manufacturers (‘‘ASM’’), the 

results of the engineering analysis, and 

interviews with manufacturers to 

determine the inputs necessary to 

calculate industry-wide labor 

expenditures and domestic employment 

levels. Labor expenditures involved 

with the manufacturing of ESEMs are a 

function of the labor intensity of the 

product, the sales volume, and an 

assumption that wages remain fixed in 

real terms over time. 

In the GRIM, DOE used the labor 

content of each piece of equipment and 

the MPCs to estimate the annual labor 

expenditures of the industry. DOE used 

Census data and interviews with 

manufacturers to estimate the portion of 

the total labor expenditures attributable 

to domestic labor. 

The production worker estimates in 

this employment section cover only 

workers up to the line-supervisor level 

who are directly involved in fabricating 

and assembling ESEMs within a motor 

facility. Workers performing services 

that are closely associated with 

production operations, such as material 

handling with a forklift, are also 

included as production labor. DOE’s 

estimates account for only production 

workers who manufacture the specific 

equipment covered by this proposed 

rulemaking. 

The employment impacts shown in 

Table V–29 represent the potential 

production employment impacts 

resulting from new energy conservation 

standards. The upper bound of the 

results estimates the maximum change 

in the number of production workers 

that could occur after compliance with 

new energy conservation standards 

when assuming that manufacturers 

continue to produce the same scope of 

covered equipment in the same 

production facilities. It also assumes 

that domestic production does not shift 

to lower-labor-cost countries. Because 

there is a real risk of manufacturers 

evaluating sourcing decisions in 

response to new energy conservation 

standards, the lower bound of the 

employment results includes the 

estimated total number of U.S. 

production workers in the industry who 

could lose their jobs if some existing 

ESEM production was moved outside of 

the U.S. While the results present a 

range of employment impacts following 

2029, this section also includes 

qualitative discussions of the likelihood 

of negative employment impacts at the 

various TSLs. Finally, the employment 

impacts shown are independent of the 

indirect employment impacts from the 

broader U.S. economy, which are 

documented in chapter 16 of the NOPR 

TSD. 

Based on 2021 ASM data and 

interviews with manufacturers, DOE 

estimates approximately 15 percent of 

ESEMs covered by this proposed 

rulemaking sold in the U.S. are 

manufactured domestically. Using this 

assumption, DOE estimates that in the 

absence of new energy conservation 

standards, there would be 

approximately 784 domestic production 

workers involved in manufacturing all 

ESEMs covered by this rulemaking in 

2029. Table V–29 shows the range of 

potential impacts of new energy 

conservation standards on U.S. 

production workers involved in the 

production of ESEMs covered by this 

rulemaking. 

TABLE V–29—POTENTIAL CHANGE IN THE NUMBER OF DOMESTIC ESEM WORKERS

No-newstandards 

case 

Trail standard level 

1 2 3 4 

Domestic Production Workers in 2029 ................................ 784 821 859 1,226 1,706 

Domestic Non-Production Workers in 2029 ........................ 449 470 492 702 977 

Total Domestic Employment in 2029 ................................... 1,233 1,291 1,351 1,928 2,683 

Potential Changes in Total Domestic Employment in 

2029 * ................................................................................ ........................ 58–(37) 118–(75) 695–(442) 1,450–(784) 

* DOE presents a range of potential impacts. Numbers in parentheses indicate negative values. 

At the upper end of the range, all 

examined TSLs show an increase in the 

number of domestic production workers 

for ESEMs. The upper end of the range 

represents a scenario where 

manufacturers increase production 

hiring due to the increase in the labor 

associated with adding the required 

components and additional labor (e.g., 

hand winding, etc.) to make more 

efficient ESEMs. However, as previously 

stated, this assumes that in addition to 

hiring more production employees, all 

existing domestic production would 

remain in the United States and not 

shift to lower labor-cost countries. 

At the lower end of the range, all 

examined TSLs show a decrease in 

domestic production employment. The 

lower end of the domestic employment 

range assumes that some, or all, ESEM 

domestic production employment may 

shift to lower labor-cost countries in 

response to energy conservation 

standards. DOE estimates that 

approximately 85 percent of all ESEMs 

sold in the U.S. are manufactured 

abroad. At max-tech, TSL 4, DOE 

conservatively estimates that the 

remaining 15 percent of domestic 

production could shift to foreign 

production locations. DOE estimated 

this lower bound potential change in 

domestic employment based on the 

percent change in the MPC at each 

TSL.96

c. Impacts on Manufacturing Capacity 

The December 2022 Joint 

Recommendation stated that standards 

set at EL 2 for the ESEM High/Med 

Torque equipment class would 

minimize potential market disruptions 

by allowing CSIR and split-phase 

topologies to remain on the market, but 

only at smaller (0.25–0.5 hp) 

horsepower ratings. (Electric Motors 

Working Group, No. 38 at p. 3) The 

December 2022 Joint Recommendation 

also stated that standards set at EL 2 for 

the ESEM Low Torque equipment class 

would not create widespread market 

disruptions and that standards set at 

higher ELs could result in significant 

increases in the physical size, 

unavailability of product, and in some 

cases, may be extremely difficult to 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87123 

achieve with current PSC technology. 

(Id.) 

Many ESEM manufacturers do not 

offer any ESEM models that would meet 

max-tech levels or one EL below maxtech (i.e., TSL 4 and TSL 3, 

respectively). Based on the shipments 

analysis used in the NIA, DOE estimates 

that less than one percent and 9 percent 

of all ESEM shipments will meet maxtech and one EL below max-tech, 

respectively, in the no-new-standards 

case in 2029, the compliance year of 

new standards. Therefore, at TSL 4 and 

TSL 3, DOE estimates that 

manufacturers will have to redesign 

models representing over 99 percent 

and 91 percent, respectively, of all 

ESEM shipments by the compliance 

date. It is unclear if any ESEM 

manufacturers would have the 

engineering capacity to complete the 

necessary redesigns within the 4-year 

compliance period. If manufacturers 

require more than 4 years to redesign 

their non-compliant ESEM models, they 

will likely prioritize redesigns based on 

sales volume, which could result in 

customers not being able to obtain 

compliant ESEMs covering the entire 

range of horsepower and motor 

configurations that they require. 

Lastly, during manufacturer 

interviews, most manufacturers stated 

they would not be able to provide a full 

portfolio of any ESEM equipment class 

for any standards that would be met 

using copper rotors. In DOE’s 

engineering analysis, all representative 

units, except the ESEM—Low Torque, 

0.5 hp and AO–ESEM—Low Torque, 0.5 

hp representative units, are modeled to 

use copper rotors at the max-tech 

efficiency design (i.e., EL 4). No other 

lower ELs are modeled to use die-cast 

copper rotors. Most manufacturers 

stated that they do not currently have 

the machinery, technology, or 

engineering resources to produce copper 

rotors in-house. Some manufacturers 

claim that the few manufacturers that do 

have the capability of producing copper 

rotors are not able to produce these 

motors in volumes sufficient to fulfill all 

shipments of that equipment class and 

would not be able to ramp up those 

production volumes over the four-year 

compliance period. For manufacturers 

to either completely redesign their 

motor production lines or significantly 

expand their very limited copper rotor 

production line would require a massive 

retooling and engineering effort, which 

could take more than a decade to 

complete. Most manufacturers stated 

they would have to outsource copper 

rotor production because they would 

not be able to modify their facilities and 

production processes to produce copper 

rotors in-house within a four-year time 

period. Most manufacturers agreed that 

outsourcing rotor die casting would 

constrain capacity by creating a 

bottleneck in rotor production, as there 

are very few companies that produce 

copper rotors. 

Manufacturers also pointed out that 

there is substantial uncertainty 

surrounding the global availability and 

price of copper, which has the potential 

to constrain capacity. Several 

manufacturers expressed concern that 

the combination of all of these factors 

would make it impossible to support 

existing customers while redesigning 

equipment lines and retooling. 

DOE estimates there is a strong 

likelihood of manufacturer capacity 

constraints in the near term for any 

standards that would likely require the 

use of copper rotors for any equipment 

classes both due to the uncertainty of 

the global supply of copper and due to 

the quantity of machinery that would 

need to be purchased and the 

engineering resources that would be 

required to produce copper rotors. 

Therefore, there could be significant 

market disruption for any standards set 

at EL 4 for any equipment class, except 

for the ESEM—Low Torque, 0.25–3 hp 

and the AO–ESEM—Low Torque, 0.25– 

3 hp equipment classes. 

d. Impacts on Subgroups of 

Manufacturers 

Using average cost assumptions to 

develop an industry cash-flow estimate 

may not be adequate for assessing 

differential impacts among 

manufacturer subgroups. Small 

manufacturers, niche equipment 

manufacturers, and manufacturers 

exhibiting cost structures substantially 

different from the industry average 

could be affected disproportionately. 

DOE discusses the impacts on small 

businesses in section VI.B of this 

document and did not identify any 

other adversely impacted ESEM-related 

manufacturer subgroups for this 

proposed rulemaking based on the 

results of the industry characterization. 

e. Cumulative Regulatory Burden 

One aspect of assessing manufacturer 

burden involves looking at the 

cumulative impact of multiple DOE 

standards and the product-specific 

regulatory actions of other Federal 

agencies that affect the manufacturers of 

a covered product or equipment. While 

any one regulation may not impose a 

significant burden on manufacturers, 

the combined effects of several existing 

or impending regulations may have 

serious consequences for some 

manufacturers, groups of manufacturers, 

or an entire industry. Assessing the 

impact of a single regulation may 

overlook this cumulative regulatory 

burden. In addition to energy 

conservation standards, other 

regulations can significantly affect 

manufacturers’ financial operations. 

Multiple regulations affecting the same 

manufacturer can strain profits and lead 

companies to abandon equipment lines 

or markets with lower expected future 

returns than competing products. For 

these reasons, DOE conducts an analysis 

of cumulative regulatory burden as part 

of its rulemakings pertaining to 

appliance efficiency. DOE requests 

information regarding the impact of 

cumulative regulatory burden on 

manufacturers of ESEMs associated with 

multiple DOE standards or productspecific regulatory actions of other 

Federal agencies. 

DOE evaluates product-specific 

regulations that will take effect 

approximately 3 years before or after the 

2029 compliance date of any new 

energy conservation standards for 

ESEMs. This information is presented in 

Table V.30. 

TABLE V.30—COMPLIANCE DATES AND EXPECTED CONVERSION EXPENSES OF FEDERAL ENERGY CONSERVATION

STANDARDS AFFECTING ESEM MANUFACTURERS

Federal energy conservation standard Number of 

mfrs * 

Number of 

manufacturers 

affected from 

this rule ** 

Approx. 

standards 

year 

Industry 

conversion 

costs 

(millions) 

Industry 

conversion 

costs/product 

revenue *** 

(%) 

Dedicated-Purpose Pool Pump Motors 88 FR 66966 (Sep. 

28, 2023) .......................................................................... 5 5 2026 & 2028 $56.2 (2022$) 5.1 

Distribution Transformer 88 FR 1722 (Jan. 11, 2023) † ...... 27 6 2027 $343 (2021$) 2.7 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87124 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

97U.S. Office of Management and Budget. 

Circular A–4: Regulatory Analysis. September 17, 

2003. http://obamawhitehouse.archives.gov/omb/ 

circulars_a004_a-4 (last accessed May 1, 2023). 

98EPCA requires DOE to review its standards at 

least once every 6 years, and requires, for certain 

products, a 3-year period after any new standard is 

promulgated before compliance is required, except 

that in no case may any new standards be required 

within 6 years of the compliance date of the 

previous standards. (42 U.S.C. 6316(a); 42 U.S.C. 

6295(m)) While adding a 6-year review to the 3-year 

compliance period adds up to 9 years, DOE notes 

that it may undertake reviews at any time within 

the 6-year period and that the 3-year compliance 

date may yield to the 6-year backstop. A 9-year 

TABLE V.30—COMPLIANCE DATES AND EXPECTED CONVERSION EXPENSES OF FEDERAL ENERGY CONSERVATION

STANDARDS AFFECTING ESEM MANUFACTURERS—Continued 

Federal energy conservation standard Number of 

mfrs * 

Number of 

manufacturers 

affected from 

this rule ** 

Approx. 

standards 

year 

Industry 

conversion 

costs 

(millions) 

Industry 

conversion 

costs/product 

revenue *** 

(%) 

Electric Motors 88 FR 36066 (Jun. 1, 2023) ....................... 74 74 2027 $468 (2021$) 2.6 

* This column presents the total number of manufacturers identified in the energy conservation standard rule contributing to cumulative regulatory burden. 

** This column presents the number of manufacturers producing ESEMs that are also listed as manufacturers in the listed energy conservation 

standard contributing to cumulative regulatory burden. 

*** This column presents industry conversion costs as a percentage of product revenue during the conversion period. Industry conversion costs 

are the upfront investments manufacturers must make to sell compliant products/equipment. The revenue used for this calculation is the revenue 

from just the covered product/equipment associated with each row. The conversion period is the time frame over which conversion costs are 

made and lasts from the publication year of the final rule to the compliance year of the energy conservation standard. The conversion period 

typically ranges from 3 to 5 years, depending on the rulemaking. 

† Indicates a proposed rulemaking. Final values may change upon the publication of a final rule. 

In response to the March 2022 

Preliminary Analysis, the Joint 

Stakeholders commented that regulating 

motors that are components 

significantly increases the burden on 

manufacturers if all products using 

special and definite purpose motors 

were suddenly forced to certify 

compliance with standards for 

component parts, including the testing, 

paperwork, and record-keeping 

requirements that accompany 

certification. (Joint Stakeholders, No. 23 

at p. 5) As stated in section II.A and 

section IV.A.1 of this document, EPCA, 

as amended through EISA 2007, 

provides DOE with the authority to 

regulate the expanded scope of motors 

addressed in this rule, whether those 

electric motors are manufactured alone 

or as a component of another piece of 

equipment. DOE believes this ESEM 

proposed rulemaking would not impact 

manufacturers of consumer products. 

For commercial equipment, DOE 

identified the following equipment as 

potentially incorporating ESEMs: walkin coolers and freezers, circulator 

pumps, air circulating fans, and 

commercial unitary air conditioning 

equipment. If the proposed energy 

conservation standards for these rules 

finalize as proposed, DOE identified 

that these rules would all: (1) have a 

compliance year that is at or before the 

ESEM standard compliance year (2029) 

and/or (2) require a motor that is either 

outside of the scope of ESEM (e.g., an 

ECM) or an ESEM with an efficiency 

above the proposed ESEM standards, 

and therefore would not be impacted by 

this ESEM proposed rulemaking (i.e., 

the ESEM rule would not trigger a 

redesign of these equipment). 

3. National Impact Analysis 

This section presents DOE’s estimates 

of the national energy savings and the 

NPV of consumer benefits that would 

result from each of the TSLs considered 

as potential new standards. 

a. Significance of Energy Savings 

To estimate the energy savings 

attributable to potential new standards 

for ESEMs, DOE compared their energy 

consumption under the no-newstandards case to their anticipated 

energy consumption under each TSL. 

The savings are measured over the 

entire lifetime of products purchased in 

the 30-year period that begins in the 

year of anticipated compliance with 

new standards (2029–2058). Table V–31 

presents DOE’s projections of the 

national energy savings for each TSL 

considered for ESEMs. The savings were 

calculated using the approach described 

in section IV.H.2 of this document. 

TABLE V–31—CUMULATIVE NATIONAL ENERGY SAVINGS FOR ESEMS; 30 YEARS OF SHIPMENTS

[2029–2058] 

Trial standard level 

1 2 3 4 

(Quads) 

Primary energy ................................................................................................ 3.0 8.7 16.5 23.6

FFC energy ...................................................................................................... 3.1 8.9 17.0 24.2 

OMB Circular A–4 97 requires 

agencies to present analytical results, 

including separate schedules of the 

monetized benefits and costs that show 

the type and timing of benefits and 

costs. Circular A–4 also directs agencies 

to consider the variability of key 

elements underlying the estimates of 

benefits and costs. For this NOPR, DOE 

undertook a sensitivity analysis using 9 

years, rather than 30 years, of 

equipment shipments. The choice of a 

9-year period is a proxy for the timeline 

in EPCA for the review of certain energy 

conservation standards and potential 

revision of and compliance with such 

revised standards.98 The review 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87125 

analysis period may not be appropriate given the 

variability that occurs in the timing of standards 

reviews and the fact that for some products, the 

compliance period is 5 years rather than 3 years. 

99U.S. Office of Management and Budget. 

Circular A–4: Regulatory Analysis. September 17, 

2003. obamawhitehouse.archives.gov/omb/ 

circulars_a004_a-4 (last accessed July 1, 2021). 

timeframe established in EPCA is 

generally not synchronized with the 

equipment lifetime, equipment 

manufacturing cycles, or other factors 

specific to ESEMs. Thus, such results 

are presented for informational 

purposes only and are not indicative of 

any change in DOE’s analytical 

methodology. The NES sensitivity 

analysis results based on a 9-year 

analytical period are presented in Table 

V–32. The impacts are counted over the 

lifetime of ESEMs purchased in 2029– 

2037. 

TABLE V–32—CUMULATIVE NATIONAL ENERGY SAVINGS FOR ESEMS; 9 YEARS OF SHIPMENTS

[2029–2037] 

Trial standard level 

1 2 3 4 

(Quads) 

Primary energy ................................................................................................ 0.8 2.4 4.5 6.4 

FFC energy ...................................................................................................... 0.8 2.4 4.6 6.6

b. Net Present Value of Consumer Costs 

and Benefits 

DOE estimated the cumulative NPV of 

the total costs and savings for 

consumers that would result from the 

TSLs considered for ESEMs. In 

accordance with OMB’s guidelines on 

regulatory analysis,99 DOE calculated 

NPV using both a 7-percent and a 3- 

percent real discount rate. Table V–33 

shows the consumer NPV results with 

impacts counted over the lifetime of 

equipment purchased in 2029–2058. 

TABLE V–33—CUMULATIVE NET PRESENT VALUE OF CONSUMER BENEFITS FOR ESEMS; 30 YEARS OF SHIPMENTS

[2029–2058] 

Discount rate 

Trial standard level 

1 2 3 4 

(billion 2022$) 

3 percent .......................................................................................................... 14.0 45.0 50.4 36.8 

7 percent .......................................................................................................... 6.4 21.0 21.0 11.2 

The NPV results based on the 

aforementioned 9-year analytical period 

are presented in Table V–34. The 

impacts are counted over the lifetime of 

equipment purchased in 2029–2037. As 

mentioned previously, such results are 

presented for informational purposes 

only and are not indicative of any 

change in DOE’s analytical methodology 

or decision criteria. 

TABLE V–34—CUMULATIVE NET PRESENT VALUE OF CONSUMER BENEFITS FOR ESEMS; 9 YEARS OF SHIPMENTS

[2029–2037] 

Discount rate 

Trial standard level 

1 2 3 4 

(billion 2022$) 

3 percent .......................................................................................................... 5.1 16.3 18.1 12.9 

7 percent .......................................................................................................... 3.2 10.3 10.1 5.2 

The previous results reflect the use of 

a default trend to estimate the change in 

price for ESEMs over the analysis period 

(see section IV.F.1 of this document). 

DOE also conducted a sensitivity 

analysis that considered one scenario 

with a price decline and one scenario 

with a price increase compared to the 

reference case. The results of these 

alternative cases are presented in 

appendix 10C of the NOPR TSD. In the 

decreasing price case, the NPV of 

consumer benefits is higher than in the 

default case. In the increasing price 

case, the NPV of consumer benefits is 

lower than in the default case. 

c. Indirect Impacts on Employment 

DOE estimates that new energy 

conservation standards for ESEMs will 

reduce energy expenditures for 

consumers of those equipment, with the 

resulting net savings being redirected to 

other forms of economic activity. These 

expected shifts in spending and 

economic activity could affect the 

demand for labor. As described in 

section IV.N of this document, DOE 

used an input/output model of the U.S. 

economy to estimate indirect 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87126 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

employment impacts of the TSLs that 

DOE considered. There are uncertainties 

involved in projecting employment 

impacts, especially changes in the later 

years of the analysis. Therefore, DOE 

generated results for near-term 

timeframes (2029–2034), where these 

uncertainties are reduced. 

The results suggest that the proposed 

standards are likely to have a negligible 

impact on the net demand for labor in 

the economy. The net change in jobs is 

so small that it would be imperceptible 

in national labor statistics and might be 

offset by other, unanticipated effects on 

employment. Chapter 16 of the NOPR 

TSD presents detailed results regarding 

anticipated indirect employment 

impacts. 

4. Impact on Utility or Performance of 

Products 

As discussed in section IV.C.1.c of 

this document, DOE has tentatively 

concluded that the standards proposed 

in this NOPR would not lessen the 

utility or performance of the ESEMs 

under consideration in this proposed 

rulemaking. Manufacturers of these 

products currently offer units that meet 

or exceed the proposed standards. 

5. Impact of Any Lessening of 

Competition 

DOE considered any lessening of 

competition that would be likely to 

result from new or amended standards. 

As discussed in section III.F.1.e of this 

document, the Attorney General 

determines the impact, if any, of any 

lessening of competition likely to result 

from a proposed standard, and transmits 

such determination in writing to the 

Secretary, together with an analysis of 

the nature and extent of such impact. To 

assist the Attorney General in making 

this determination, DOE has provided 

DOJ with copies of this NOPR and the 

accompanying NOPR TSD for review. 

DOE will consider DOJ’s comments on 

the proposed rule in determining 

whether to proceed to a final rule. DOE 

will publish and respond to DOJ’s 

comments in that document. DOE 

invites comment from the public 

regarding the competitive impacts that 

are likely to result from this proposed 

rule. In addition, stakeholders may also 

provide comments separately to DOJ 

regarding these potential impacts. See 

the ADDRESSES section for information 

to send comments to DOJ. 

6. Need of the Nation To Conserve 

Energy 

Enhanced energy efficiency, where 

economically justified, improves the 

Nation’s energy security, strengthens the 

economy, and reduces the 

environmental impacts (costs) of energy 

production. Reduced electricity demand 

due to energy conservation standards is 

also likely to reduce the cost of 

maintaining the reliability of the 

electricity system, particularly during 

peak-load periods. Chapter 15 in the 

NOPR TSD presents the estimated 

impacts on electricity generating 

capacity, relative to the no-newstandards case, for the TSLs that DOE 

considered in this proposed rulemaking. 

Energy conservation resulting from 

potential energy conservation standards 

for ESEMs is expected to yield 

environmental benefits in the form of 

reduced emissions of certain air 

pollutants and greenhouse gases. Table 

V–35 provides DOE’s estimate of 

cumulative emissions reductions 

expected to result from the TSLs 

considered in this NOPR. The emissions 

were calculated using the multipliers 

discussed in section IV.L of this 

document. DOE reports annual 

emissions reductions for each TSL in 

chapter 13 of the NOPR TSD. 

TABLE V–35—CUMULATIVE EMISSIONS REDUCTION FOR ESEMS SHIPPED IN 2029–2058 

Trial standard level 

1 2 3 4 

Electric Power Sector Emissions 

CO2 (million metric tons) ................................................................................................. 50.0 145.6 277.6 397.2 

CH4 (thousand tons) ........................................................................................................ 3.4 10.0 19.2 27.5 

N2O (thousand tons) ........................................................................................................ 0.5 1.4 2.6 3.8 

SO2 (thousand tons) ........................................................................................................ 23.3 67.8 129.6 185.6 

NOX (thousand tons) ....................................................................................................... 14.7 42.9 82.6 118.6 

Hg (tons) .......................................................................................................................... 0.1 0.3 0.6 0.8 

Upstream Emissions 

CO2 (million metric tons) ................................................................................................. 5.1 14.9 28.4 40.6 

CH4 (thousand tons) ........................................................................................................ 464.2 1,352.2 2,574.8 3,682.0 

N2O (thousand tons) ........................................................................................................ 0.0 0.1 0.1 0.2 

SO2 (thousand tons) ........................................................................................................ 79.6 232.0 441.7 631.7

NOX (thousand tons) ....................................................................................................... 0.3 0.9 1.7 2.5 

Hg (tons) .......................................................................................................................... 0.0 0.0 0.0 0.0 

Total FFC Emissions 

CO2 (million metric tons) ................................................................................................. 55.1 160.5 306.0 437.8 

CH4 (thousand tons) ........................................................................................................ 467.6 1,362.2 2,593.9 3,709.4 

N2O (thousand tons) ........................................................................................................ 0.5 1.4 2.8 4.0 

SO2 (thousand tons) ........................................................................................................ 102.9 299.8 571.3 817.3 

NOX (thousand tons) ....................................................................................................... 15.0 43.8 84.3 121.1 

Hg (tons) .......................................................................................................................... 0.1 0.3 0.6 0.8 

As part of the analysis for this 

rulemaking, DOE estimated monetary 

benefits likely to result from the 

reduced emissions of CO2 that DOE 

estimated for each of the considered 

TSLs for ESEMs. Section IV.L of this 

document discusses the SC–CO2 values 

that DOE used. Table V–36 presents the 

value of CO2 emissions reduction at 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87127 

each TSL for each of the SC–CO2 cases. 

The time-series of annual values is 

presented for the proposed TSL in 

chapter 14 of the NOPR TSD. 

TABLE V–36—PRESENT VALUE OF CO2 EMISSIONS REDUCTION FOR ESEMS SHIPPED IN 2029–2058 

TSL 

SC–CO2 case 

Discount rate and statistics 

5% 

Average 

3% 

Average 

2.5% 

Average 

3% 

95th percentile 

(billion 2022$) 

1 ............................................................................................................................. 0.61 2.55 3.95 7.76 

2 ............................................................................................................................. 1.79 7.43 11.52 22.59 

3 ............................................................................................................................. 3.42 14.18 21.97 43.10 

4 ............................................................................................................................. 4.89 20.29 31.43 61.67 

As discussed in section IV.L.2 of this 

document, DOE estimated the climate 

benefits likely to result from the 

reduced emissions of methane and N2O 

that DOE estimated for each of the 

considered TSLs for ESEMs. Table V–37 

presents the value of the CH4 emissions 

reduction at each TSL, and Table V–38 

presents the value of the N2O emissions 

reduction at each TSL. The time-series 

of annual values is presented for the 

proposed TSL in chapter 14 of the 

NOPR TSD. 

TABLE V–37—PRESENT VALUE OF METHANE EMISSIONS REDUCTION FOR ESEMS SHIPPED IN 2029–2058 

TSL 

SC–CH4 case 

Discount rate and statistics 

5% 

Average 

3% 

Average 

2.5% 

Average 

3% 

95th percentile 

(billion 2022$) 

1 ............................................................................................................................. 0.24 0.68 0.94 1.80 

2 ............................................................................................................................. 0.69 1.99 2.75 5.26 

3 ............................................................................................................................. 1.32 3.79 5.24 10.01 

4 ............................................................................................................................. 1.88 5.42 7.49 14.32 

TABLE V–38—PRESENT VALUE OF NITROUS OXIDE EMISSIONS REDUCTION FOR ESEMS SHIPPED IN 2029–2058 

TSL 

SC–N2O case 

Discount rate and statistics 

5% 

Average 

3% 

Average 

2.5% 

Average 

3% 

95th percentile 

(billion 2022$) 

1 ............................................................................................................................. 0.002 0.008 0.012 0.022 

2 ............................................................................................................................. 0.006 0.024 0.036 0.063 

3 ............................................................................................................................. 0.012 0.045 0.070 0.121 

4 ............................................................................................................................. 0.017 0.065 0.100 0.173 

DOE is well aware that scientific and 

economic knowledge about the 

contribution of CO2 and other GHG 

emissions to changes in the future 

global climate and the potential 

resulting damages to the global and U.S. 

economy continues to evolve rapidly. 

DOE, together with other Federal 

agencies, will continue to review 

methodologies for estimating the 

monetary value of reductions in CO2

and other GHG emissions. This ongoing 

review will consider the comments on 

this subject that are part of the public 

record for this and other rulemakings, as 

well as other methodological 

assumptions and issues. DOE notes that 

the proposed standards would be 

economically justified even without 

inclusion of monetized benefits of 

reduced GHG emissions. 

DOE also estimated the monetary 

value of the health benefits associated 

with NOX and SO2 emissions reductions 

anticipated to result from the 

considered TSLs for ESEMs. The dollarper-ton values that DOE used are 

discussed in section IV.L of this 

document. Table V–39 presents the 

present value for NOX emissions 

reduction for each TSL calculated using 

7-percent and 3-percent discount rates, 

and Table V–40 presents similar results 

for SO2 emissions reductions. The 

results in these tables reflect application 

of EPA’s low dollar-per-ton values, 

which DOE used to be conservative. The 

time-series of annual values is presented 

for the proposed TSL in chapter 14 of 

the NOPR TSD. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87128 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE V–39—PRESENT VALUE OF NOX EMISSIONS REDUCTION FOR ESEMS SHIPPED IN 2029–2058 

TSL 7% Discount rate 3% Discount rate 

(million 2022$) 

1 ............................................................................................................................................................... 2,249.3 5,221.7 

2 ............................................................................................................................................................... 6,551.5 15,211.6 

3 ............................................................................................................................................................... 12,497.5 29,002.1 

4 ............................................................................................................................................................... 17,883.3 41,492.7 

TABLE V–40—PRESENT VALUE OF SO2 EMISSIONS REDUCTION FOR ESEMS SHIPPED IN 2029–2058 

TSL 3% Discount rate 7% Discount rate 

(million 2022$) 

1 ............................................................................................................................................................... 467.5 1,065.7 

2 ............................................................................................................................................................... 1,362.5 3,106.6 

3 ............................................................................................................................................................... 2,624.4 5,981.4 

4 ............................................................................................................................................................... 3,767.9 8,586.2 

Not all the public health and 

environmental benefits from the 

reduction of greenhouse gases, NOX, 

and SO2 are captured in the values 

above, and additional unquantified 

benefits from the reductions of those 

pollutants as well as from the reduction 

of direct PM and other co-pollutants 

may be significant. DOE has not 

included monetary benefits of the 

reduction of Hg emissions because the 

amount of reduction is very small. 

7. Other Factors 

The Secretary of Energy, in 

determining whether a standard is 

economically justified, may consider 

any other factors that the Secretary 

deems to be relevant. (42 U.S.C. 6316(a); 

42 U.S.C. 6295(o)(2)(B)(i)(VII)) No other 

factors were considered in this analysis. 

8. Summary of Economic Impacts 

Table V–41 presents the NPV values 

that result from adding the estimates of 

the potential economic benefits 

resulting from reduced GHG and NOX

and SO2 emissions to the NPV of 

consumer benefits calculated for each 

TSL considered in this proposed 

rulemaking. The consumer benefits are 

domestic U.S. monetary savings that 

occur as a result of purchasing the 

covered ESEMs and are measured for 

the lifetime of products shipped in 

2029–2058. The climate benefits 

associated with reduced GHG emissions 

resulting from the proposed standards 

are global benefits and are also 

calculated based on the lifetime of 

ESEMs shipped in 2029–2058. 

TABLE V–41—CONSUMER NPV COMBINED WITH PRESENT VALUE OF CLIMATE BENEFITS AND HEALTH BENEFITS

Category TSL 1 TSL 2 TSL 3 TSL 4 

Using 3% discount rate for Consumer NPV and Health Benefits (billion 2022$) 

5% Average SC–GHG case ............................................................................................................ 21.2 65.8 90.1 93.7 

3% Average SC–GHG case ............................................................................................................ 23.6 72.8 103.4 112.7 

2.5% Average SC–GHG case ......................................................................................................... 25.2 77.6 112.6 125.9 

3% 95th percentile SC–GHG case .................................................................................................. 29.9 91.2 138.6 163.1 

Using 7% discount rate for Consumer NPV and Health Benefits (billion 2022$) 

5% Average SC–GHG case ............................................................................................................ 10.0 31.4 40.8 39.7 

3% Average SC–GHG case ............................................................................................................ 12.4 38.3 54.1 58.7 

2.5% Average SC–GHG case ......................................................................................................... 14.1 43.2 63.4 71.9 

3% 95th percentile SC–GHG case .................................................................................................. 18.7 56.8 89.3 109.1 

C. Conclusion 

When considering new or amended 

energy conservation standards, the 

standards that DOE adopts for any type 

(or class) of covered equipment must be 

designed to achieve the maximum 

improvement in energy efficiency that 

the Secretary determines is 

technologically feasible and 

economically justified. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(2)(A)) In 

determining whether a standard is 

economically justified, the Secretary 

must determine whether the benefits of 

the standard exceed its burdens by, to 

the greatest extent practicable, 

considering the seven statutory factors 

discussed previously. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(2)(B)(i)) The 

new or amended standard must also 

result in significant conservation of 

energy. (42 U.S.C. 6316(a); 42 U.S.C. 

6295(o)(3)(B)) 

For this NOPR, DOE considered the 

impacts of new standards for ESEMs at 

each TSL, beginning with the maximum 

technologically feasible level, to 

determine whether that level was 

economically justified. Where the maxtech level was not justified, DOE then 

considered the next most efficient level 

and undertook the same evaluation until 

it reached the highest efficiency level 

that is both technologically feasible and 

economically justified and saves a 

significant amount of energy. 

To aid the reader as DOE discusses 

the benefits and/or burdens of each TSL, 

tables in this section present a summary 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87129 

of the results of DOE’s quantitative 

analysis for each TSL. In addition to the 

quantitative results presented in the 

tables, DOE also considers other 

burdens and benefits that affect 

economic justification. These include 

the impacts on identifiable subgroups of 

consumers who may be 

disproportionately affected by a national 

standard and impacts on employment. 

1. Benefits and Burdens of TSLs 

Considered for ESEM Standards 

Table V–42 and Table V–43 

summarize the quantitative impacts 

estimated for each TSL for ESEMs. The 

national impacts are measured over the 

lifetime of ESEMs purchased in the 30- 

year period that begins in the 

anticipated year of compliance with 

new standards (2029–2058). The energy 

savings, emissions reductions, and 

value of emissions reductions refer to 

full-fuel-cycle results. The efficiency 

levels contained in each TSL are 

described in section V.A of this 

document. 

TABLE V–42—SUMMARY OF ANALYTICAL RESULTS FOR ESEMS TSLS: NATIONAL IMPACTS

Category TSL 1 TSL 2 TSL 3 TSL 4 

Cumulative FFC National Energy Savings 

Quads .............................................................................................................................................. 3.1 8.9 17.0 24.2 

Cumulative FFC Emissions Reduction 

CO2 (million metric tons) ................................................................................................................. 55.1 160.5 306.0 437.8 

CH4 (thousand tons) ........................................................................................................................ 467.6 1,362.2 2,593.9 3,709.4 

N2O (thousand tons) ........................................................................................................................ 0.5 1.4 2.8 4.0 

SO2 (thousand tons) ........................................................................................................................ 102.9 299.8 571.3 817.3 

NOX (thousand tons) ....................................................................................................................... 15.0 43.8 84.3 121.1 

Hg (tons) .......................................................................................................................................... 0.1 0.3 0.6 0.8 

Present Value of Benefits and Costs (3% discount rate, billion 2022$) 

Consumer Operating Cost Savings ................................................................................................. 18.7 54.7 107.0 154.5 

Climate Benefits * ............................................................................................................................. 3.2 9.4 18.0 25.8 

Health Benefits ** ............................................................................................................................. 6.3 18.3 35.0 50.1 

Total Benefits † ................................................................................................................................ 28.3 82.4 160.0 230.3 

Consumer Incremental Equipment Costs ‡ ..................................................................................... 4.7 9.7 56.7 117.7 

Consumer Net Benefits ................................................................................................................... 14.0 45.0 50.4 36.8 

Total Net Benefits ............................................................................................................................ 23.6 72.8 103.4 112.7 

Present Value of Benefits and Costs (7% discount rate, billion 2022$) 

Consumer Operating Cost Savings ................................................................................................. 8.94 26.10 51.09 73.76 

Climate Benefits * ............................................................................................................................. 3.24 9.45 18.01 25.77 

Health Benefits ** ............................................................................................................................. 2.72 7.91 15.12 21.65 

Total Benefits † ................................................................................................................................ 14.89 43.46 84.23 121.18 

Consumer Incremental Equipment Costs ‡ ..................................................................................... 2.49 5.14 30.12 62.52 

Consumer Net Benefits ................................................................................................................... 6.45 20.95 20.98 11.24 

Total Net Benefits ............................................................................................................................ 12.41 38.31 54.11 58.66 

Note: This table presents the costs and benefits associated with ESEMs shipped in 2029–2058. These results include consumer, climate, and 

health benefits which accrue after 2058 from the products shipped in 2029–2058. 

* Climate benefits are calculated using four different estimates of the SC–CO2, SC–CH4 and SC–N2O. Together, these represent the global 

SC–GHG. For presentational purposes of this table, the climate benefits associated with the average SC–GHG at a 3 percent discount rate are 

shown; however, DOE emphasizes the importance and value of considering the benefits calculated using all four sets of SC–GHG estimates. To 

monetize the benefits of reducing GHG emissions, this analysis uses the interim estimates presented in the Technical Support Document: Social 

Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates Under Executive Order 13990 published in February 2021 by the IWG. 

** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for NOX and SO2) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as 

health benefits from reductions in direct PM2.5 emissions. The health benefits are presented at real discount rates of 3 and 7 percent. See section IV.L of this document for more details. 

† Total and net benefits include consumer, climate, and health benefits. For presentation purposes, total and net benefits for both the 3-percent 

and 7-percent cases are presented using the average SC–GHG with 3-percent discount rate. 

‡ Costs include incremental equipment costs. 

TABLE V–43—SUMMARY OF ANALYTICAL RESULTS FOR ESEMS TSLS: MANUFACTURER AND CONSUMER IMPACTS

Category TSL 1 TSL 2 TSL 3 TSL 4 

Manufacturer Impacts 

Industry NPV (million 2022$) (No-new-standards case INPV = 

2,019).

1,883 to 1,818 .... 1,888 to 1,755 .... 1,820 to 1,035 .... 1,710 to 73. 

Industry NPV (% change) ............................................................. (6.7) to (9.9) ....... (6.5) to (13.1) ..... (9.9) to (48.7) ..... (15.3) to (96.4). 

Consumer Average LCC Savings (2022$) 

ESEM—High/Medium Torque, 0.25 hp ........................................ 55.6 .................... 51.3 .................... (0.8) .................... (106.5). 

ESEM—High/Medium Torque, 1 hp ............................................. 116.1 .................. 137.7 .................. 20.8 .................... (145.2). 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87130 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE V–43—SUMMARY OF ANALYTICAL RESULTS FOR ESEMS TSLS: MANUFACTURER AND CONSUMER IMPACTS— 

Continued 

Category TSL 1 TSL 2 TSL 3 TSL 4 

ESEM—Low Torque, 0.25 hp ....................................................... 212.8 .................. 146.8 .................. 24.1 .................... (16.7). 

ESEM—Low Torque, 0.5 hp ......................................................... 41.2 .................... 99.6 .................... 77.8 .................... 72.5. 

ESEM—Polyphase, 0.25 hp ......................................................... 31.9 .................... 26.2 .................... (8.3) .................... (107.3). 

AO–ESEM—High/Medium Torque, 0.25 hp ................................. 76.3 .................... 82.9 .................... 37.4 .................... (61.4). 

AO–ESEM—High/Medium Torque, 1 hp ...................................... 121.9 .................. 160.3 .................. 37.1 .................... (128.2). 

AO–ESEM—Low Torque, 0.25 hp ............................................... 217.2 .................. 121.3 .................. 31.6 .................... (13.4).. 

AO–ESEM—Low Torque, 0.5 hp ................................................. 47.6 .................... 88.4 .................... 50.0 .................... 52.4. 

AO–ESEM—Polyphase, 0.25 hp .................................................. 35.1 .................... 39.9 .................... 12.7 .................... (85.0). 

Shipment-Weighted Average * ...................................................... 82.8 .................... 101.8 .................. 43.6 .................... (9.6). 

Consumer Simple PBP (years) 

ESEM—High/Medium Torque, 0.25 hp ........................................ 0.5 ...................... 1.5 ...................... 5.3 ...................... 10.0. 

ESEM—High/Medium Torque, 1 hp ............................................. 0.7 ...................... 1.1 ...................... 4.7 ...................... 8.7. 

ESEM—Low Torque, 0.25 hp ....................................................... 0.4 ...................... 1.0 ...................... 3.3 ...................... 5.0. 

ESEM—Low Torque, 0.5 hp ......................................................... 2.4 ...................... 1.3 ...................... 2.8 ...................... 3.3. 

ESEM—Polyphase, 0.25 hp ......................................................... 1.1 ...................... 2.6 ...................... 7.4 ...................... 15.6. 

AO–ESEM—High/Medium Torque, 0.25 hp ................................. 0.3 ...................... 1.0 ...................... 3.2 ...................... 6.1. 

AO–ESEM—High/Medium Torque, 1 hp ...................................... 0.6 ...................... 0.9 ...................... 3.9 ...................... 7.7. 

AO–ESEM—Low Torque, 0.25 hp ............................................... 0.4 ...................... 1.1 ...................... 3.1 ...................... 4.9. 

AO–ESEM—Low Torque, 0.5 hp ................................................. 2.2 ...................... 0.8 ...................... 3.0 ...................... 3.4. 

AO–ESEM—Polyphase, 0.25 hp .................................................. 1.1 ...................... 2.0 ...................... 5.1 ...................... 10.8. 

Shipment-Weighted Average * ...................................................... 1.5 ...................... 1.2 ...................... 3.6 ...................... 5.7. 

Percent of Consumers that Experience a Net Cost 

ESEM—High/Medium Torque, 0.25 hp ........................................ 2% ...................... 17% .................... 51% .................... 86%. 

ESEM—High/Medium Torque, 1 hp ............................................. 3% ...................... 12% .................... 54% .................... 82%. 

ESEM—Low Torque, 0.25 hp ....................................................... 0% ...................... 3% ...................... 52% .................... 68%. 

ESEM—Low Torque, 0.5 hp ......................................................... 11% .................... 8% ...................... 30% .................... 40%. 

ESEM—Polyphase, 0.25 hp ......................................................... 1% ...................... 7% ...................... 59% .................... 95%. 

AO–ESEM—High/Medium Torque, 0.25 hp ................................. 1% ...................... 8% ...................... 36% .................... 65%. 

AO–ESEM—High/Medium Torque, 1 hp ...................................... 2% ...................... 6% ...................... 44% .................... 82%. 

AO–ESEM—Low Torque, 0.25 hp ............................................... 0% ...................... 4% ...................... 39% .................... 68%. 

AO–ESEM—Low Torque, 0.5 hp ................................................. 2% ...................... 3% ...................... 34% .................... 42% 

AO–ESEM—Polyphase, 0.25 hp .................................................. 3% ...................... 10% .................... 49% .................... 88%. 

Shipment-Weighted Average * ...................................................... 5% ...................... 8% ...................... 41% .................... 59%. 

Parentheses indicate negative (¥) values. 

* Weighted by shares of each equipment class in total projected shipments in 2022. 

DOE first considered TSL 4, which 

represents the max-tech efficiency 

levels. TSL 4 would save an estimated 

24.2 quads of energy, an amount DOE 

considers significant. Under TSL 4, the 

NPV of consumer benefit would be 

$11.24 billion using a discount rate of 

7 percent and $36.8 billion using a 

discount rate of 3 percent. 

The cumulative emissions reductions 

at TSL 4 are 437.8 Mt of CO2, 817.3 

thousand tons of SO2, 121.1 thousand 

tons of NOX, 0.8 tons of Hg, 3,709.4 

thousand tons of CH4, and 4.0 thousand 

tons of N2O. The estimated monetary 

value of the climate benefits from 

reduced GHG emissions (associated 

with the average SC–GHG at a 3-percent 

discount rate) at TSL 4 is $25.8 billion. 

The estimated monetary value of the 

health benefits from reduced SO2 and 

NOX emissions at TSL 4 is $21.7 billion 

using a 7-percent discount rate and 

$50.1 billion using a 3-percent discount 

rate. 

Using a 7-percent discount rate for 

consumer benefits and costs, health 

benefits from reduced SO2 and NOX

emissions, and the 3-percent discount 

rate case for climate benefits from 

reduced GHG emissions, the estimated 

total NPV at TSL 4 is $58.7 billion. 

Using a 3-percent discount rate for all 

benefits and costs, the estimated total 

NPV at TSL 4 is $112.7 billion. The 

estimated total NPV is provided for 

additional information, however DOE 

primarily relies upon the NPV of 

consumer benefits when determining 

whether a standard level is 

economically justified. 

At TSL 4, the average LCC impact for 

non-air over ESEMs is a savings of 

¥$107 and ¥$145 for high/medium 

torque ESEMs (0.25 and 1 hp, 

respectively); ¥$17 and $73 for low 

torque ESEMs (0.25 and 0.5 hp, 

respectively); and ¥$107 for Polyphase 

ESEMs. At TSL 4, the average LCC 

impact for AO–ESEMs is a savings of 

¥$61 and ¥$128 for high/medium 

torque AO–ESEMs (0.25 and 1 hp, 

respectively); ¥$13 and $52 for low 

torque AO–ESEMs (0.25 and 0.5 hp, 

respectively); and ¥$85 for Polyphase 

AO–ESEMs. Overall, the shipmentsweighted average LCC impact is a 

savings of ¥$10. The simple payback 

period for non-air-over ESEMs is 6.9 

and 6.3 years for high/medium torque 

ESEMs (0.25 and 1 hp, respectively); 2.0 

and 3.0 years for low torque ESEMs 

(0.25 and 0.5 hp, respectively); and 9.7 

years for polyphase ESEMs. The simple 

payback period for AO–ESEMs is 4.3 

and 5.1 years for high/medium torque 

AO–ESEMs (0.25 and 1 hp, 

respectively); 1.9 and 2.7 years for low 

torque AO–ESEMs (0.25 and 0.5 hp, 

respectively); and 8.3 years for 

polyphase AO–ESEMs. Overall, the 

shipments-weighted average PBP is 4.0 

years. The fraction of consumers 

experiencing a net LCC cost for non-airover ESEMs is 85.9 and 82.5 percent for 

high/medium torque ESEMs (0.25 and 1 

hp, respectively); 67.7 and 40.1 percent 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87131 

100The sum of annual free cash flows is estimated 

to be $636 million for 2025–2028 in the no-newstandards case and the no-new-standards case INPV 

is estimated to be $2,019 million. 

for low torque ESEMs (0.25 and 0.5 hp, 

respectively); and 95.0 percent for 

polyphase ESEMs. The fraction of 

consumers experiencing a net LCC cost 

for AO–ESEMs is 64.6 and 81.9 percent 

for high/medium torque AO–ESEMs 

(0.25 and 1 hp, respectively); 67.9 and 

42.2 percent for low torque AO–ESEMs 

(0.25 and 0.5 hp, respectively); and 87.8 

percent for polyphase AO–ESEMs. 

Overall, the shipments-weighted 

average fraction of consumers 

experiencing a net LCC cost is 59.3 

percent. 

At TSL 4, the projected change in 

INPV ranges from a decrease of $1,946 

million to a decrease of $309 million, 

which corresponds to decreases of 96.4 

percent and 15.3 percent, respectively. 

DOE estimates that industry must invest 

$2,156 million to redesign almost all 

ESEM models and to purchase new 

lamination die sets, winding machines, 

frame casts, and assembly equipment as 

well as other retooling costs to 

manufacturer compliant ESEM models 

at TSL 4. An investment of $2,156 

million in conversion costs represents 

over 3.3 times the sum of the annual 

free cash flows over the years between 

the expected publication of the final 

rule and the compliance year (i.e., the 

time period that these conversion costs 

would be incurred) and represents over 

100 percent of the entire no-newstandards case INPV over the 30-year 

analysis period.100

In the no-new-standards case, free 

cash flow is estimated to be $154 

million in 2028, the year before the 

compliance date. At TSL 4, the 

estimated free cash flow is ¥$764 

million in 2028. This represents a 

decrease in free cash flow of 595 

percent, or a decrease of $919 million, 

in 2028. A negative free cash flow 

implies that most, if not all, 

manufacturers will need to borrow 

substantial funds to be able to make 

investments necessary to comply with 

energy conservation standards at TSL 4. 

The extremely large drop in free cash 

flows could cause some ESEM 

manufacturers to exit the ESEM market 

entirely, even though recovery may be 

possible over the 30-year analysis 

period. At TSL 4, models representing 

less than 1 percent of all ESEM 

shipments are estimated to meet the 

efficiency requirements at this TSL in 

the no-new-standards case by 2029, the 

compliance year. Therefore, models 

representing over 99 percent of all 

ESEM shipments will need be 

remodeled in the 4-year compliance 

period. 

Manufacturers are unlikely to have 

the engineering capacity to conduct this 

massive redesign effort in 4 years. 

Instead, they will likely prioritize 

redesigns based on sales volume, which 

could leave market gaps in equipment 

offered by manufacturers and even the 

entire ESEMs industry. The resulting 

market gaps in equipment offerings 

could result in sub-optimal selection of 

ESEMs for some applications. Lastly, 

although DOE’s analysis assumes that 

TSL 4 can be reached without 

significant increase in size, as discussed 

in sections IV.C.3 and IV.J.2.c of this 

NOPR and in the December 2022 Joint 

Recommendation, the Electric Motor 

Working group expressed that in order 

to meet the efficiency requirements at 

TSL 4, some manufacturers may choose 

to rely on design options that could 

significantly increase the physical size 

of ESEMs. This could result in a 

significant and widespread disruption 

to the OEM markets that used ESEMs as 

an embedded product, as those OEMs 

may have to make significant changes to 

their equipment that use ESEMs because 

those ESEMs could become larger in 

physical size. 

DOE requests comment on if 

manufacturers would have the 

engineering capacity to conduct design 

efforts to be able to offer a full portfolio 

of complaint ESEM at TSL 4. If not, 

please provide any data or information 

on the potential impacts that could arise 

due to these market gaps in equipment 

offerings. 

Under 42 U.S.C. 6316(a) and 42 U.S.C. 

6295(o)(2)(B)(i), DOE determines 

whether a standard is economically 

justified after considering seven factors. 

Based on these factors, the Secretary 

tentatively concludes that at TSL 4 for 

ESEMs, the benefits of energy savings, 

positive NPV of consumer benefits, 

emission reductions, and the estimated 

monetary value of the emissions 

reductions would be outweighed by the 

economic burden on many consumers 

and the impacts on manufacturers, 

including the extremely large 

conversion costs (representing over 3.3 

times the sum of the annual free cash 

flows during the time period that these 

conversion costs will be incurred and 

over 100 percent of the entire no-newstandards case INPV), profitability 

impacts that could result in a large 

reduction in INPV (up to a decrease of 

96.4 percent), the large negative free 

cash flows in the years leading up to the 

compliance date (annual free cash flow 

is estimated to be ¥$764 million in the 

year before the compliance date), the 

lack of manufacturers currently offering 

equipment meeting the efficiency levels 

required at TSL 4 (models representing 

over 99 percent of shipments will need 

to be redesigned to meet this TSL), and 

the likelihood of the significant 

disruption in the ESEM market. Due to 

the limited amount of engineering 

resources each manufacturer has, it is 

unclear if most manufacturers will be 

able to redesign models representing on 

average 99 percent of their ESEM 

shipments covered by this rulemaking 

in the 4-year compliance period. 

Consequently, the Secretary has 

tentatively concluded that TSL 4 is not 

economically justified. 

DOE then considered TSL 3, which 

represents efficiency level 3 for all 

equipment class groups. TSL 3 would 

save an estimated 17 quads of energy, an 

amount DOE considers significant. 

Under TSL 3, the NPV of consumer 

benefit would be $11.2 billion using a 

discount rate of 7 percent and $36.8 

billion using a discount rate of 3 

percent. 

The cumulative emissions reductions 

at TSL 3 are 306.0 Mt of CO2, 571.3 

thousand tons of SO2, 84.3 thousand 

tons of NOX, 0.6 tons of Hg, 2,593.9 

thousand tons of CH4, and 2.8 thousand 

tons of N2O. The estimated monetary 

value of the climate benefits from 

reduced GHG emissions (associated 

with the average SC–GHG at a 3-percent 

discount rate) at TSL 3 is $18.0 billion. 

The estimated monetary value of the 

health benefits from reduced SO2 and 

NOX emissions at TSL 3 is $15.1 billion 

using a 7-percent discount rate and 

$35.0 billion using a 3-percent discount 

rate. 

Using a 7-percent discount rate for 

consumer benefits and costs, health 

benefits from reduced SO2 and NOX

emissions, and the 3-percent discount 

rate case for climate benefits from 

reduced GHG emissions, the estimated 

total NPV at TSL 3 is $54.1 billion. 

Using a 3-percent discount rate for all 

benefits and costs, the estimated total 

NPV at TSL 3 is $103.4 billion. The 

estimated total NPV is provided for 

additional information, however DOE 

primarily relies upon the NPV of 

consumer benefits when determining 

whether a standard level is 

economically justified. 

At TSL 3, the average LCC impact for 

non-air over ESEMs is a savings of ¥$1 

and $21 for high/medium torque ESEMs 

(0.25 and 1 hp, respectively); $24 and 

$78 for low torque ESEMs (0.25 and 0.5 

hp, respectively); and ¥$8 for 

Polyphase ESEMs. At TSL 3, the average 

LCC impact for AO–ESEMs is a savings 

of $37 and $37 for high/medium torque 

AO–ESEMs (0.25 and 1 hp, 

respectively); $32 and $50 for low 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87132 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

101The sum of annual free cash flows is estimated 

to be $636 million for 2025–2028 in the no-newstandards case and the no-new-standards case INPV 

is estimated to be $2,019 million. 

torque AO ESEMs (0.25 and 0.5 hp, 

respectively); and $13 for Polyphase 

AO–ESEMs. Overall, the shipmentsweighted average LCC impact is a 

savings of $44. The simple payback 

period for non-air-over ESEMs is 3.7 

and 3.4 years for high/medium torque 

ESEMs (0.25 and 1 hp, respectively); 1.3 

and 2.5 years for low torque ESEMs 

(0.25 and 0.5 hp, respectively); and 4.6 

years for polyphase ESEMs. The simple 

payback period for AO–ESEMs is 2.3 

and 2.7 years for high/medium torque 

AO–ESEMs (0.25 and 1 hp, 

respectively); 1.2 and 2.3 years for low 

torque AO–ESEMs (0.25 and 0.5 hp, 

respectively); and 3.9 years for 

polyphase AO–ESEMs. Overall, the 

shipments-weighted average PBP is 2.6 

years. The fraction of consumers 

experiencing a net LCC cost, for non-airover ESEMs is 51.2 and 53.5 percent for 

high/medium torque ESEMs (0.25 and 1 

hp, respectively); 52.0 and 30.4 percent 

for low torque ESEMs (0.25 and 0.5 hp, 

respectively); and 58.6 percent for 

polyphase ESEMs. The fraction of 

consumers experiencing a net LCC cost, 

for AO–ESEMs is 36.0 and 44.4 percent 

for high/medium torque AO–ESEMs 

(0.25 and 1 hp, respectively); 39.1 and 

34.4 percent for low torque AO–ESEMs 

(0.25 and 0.5 hp, respectively); and 48.6 

percent for polyphase AO–ESEMs. 

Overall, the shipments-weighted 

average fraction of consumers 

experiencing a net LCC cost is 40.6 

percent. 

At TSL 3, the projected change in 

INPV ranges from a decrease of $1,035 

million to a decrease of $199 million, 

which corresponds to decreases of 48.7 

percent and 9.9 percent, respectively. 

DOE estimates that industry must invest 

$1,118 million to redesign the majority 

of ESEM models and to purchase new 

lamination die sets, winding machines, 

frame casts, and assembly equipment as 

well as other retooling costs to 

manufacturer compliant ESEM models 

at TSL 3. An investment of $1,118 

million in conversion costs represents 

over 1.7 times the sum of the annual 

free cash flows over the years between 

the expected publication of the final 

rule and the compliance year (i.e., the 

time period that these conversion costs 

would be incurred) and represents over 

55 percent of the entire no-newstandards case INPV over the 30-year 

analysis period.101

In the no-new-standards case, free 

cash flow is estimated to be $154 

million in 2028, the year before the 

compliance date. At TSL 3, the 

estimated free cash flow is ¥$313 

million in 2028. This represents a 

decrease in free cash flow of 303 

percent, or a decrease of $468 million, 

in 2028. A negative free cash flow 

implies that most, if not all, 

manufacturers will need to borrow 

substantial funds to be able to make 

investments necessary to comply with 

energy conservation standards at TSL 3. 

The extremely large drop in free cash 

flows could cause some ESEM 

manufacturers to exit the ESEM market 

entirely, even though recovery may be 

possible over the 30-year analysis 

period. At TSL 3, models representing 

approximately 9 percent of all ESEM 

shipments are estimated to meet the 

efficiency requirements at this TSL in 

the no-new-standards case by 2029, the 

compliance year. Therefore, models 

representing approximately 91 percent 

of all ESEM shipments will need be 

remodeled in the 4-year compliance 

period. 

Manufacturers are unlikely to have 

the engineering capacity to conduct this 

massive redesign effort in 4 years. 

Instead, they will likely prioritize 

redesigns based on sales volume, which 

could leave market gaps in equipment 

offered by manufacturers and even the 

entire ESEMs industry. The resulting 

market gaps in equipment offerings 

could result in sub-optimal selection of 

ESEMs for some applications. Lastly, 

although DOE’s analysis assumes that 

TSL 3 can be reached without 

significant increase in size, as discussed 

in sections IV.C.3 and IV.J.2.c of this 

NOPR and in the December 2022 Joint 

Recommendation, the Electric Motor 

Working group expressed that in order 

to meet the efficiency requirements at 

TSL 3, some manufacturers may choose 

to rely on design options that would 

significantly increase the physical size 

of ESEMs. This could result in a 

significant and widespread disruption 

to the OEM markets that used ESEMs as 

an embedded product, as those OEMs 

may have to make significant changes to 

their equipment that use ESEMs since 

those ESEMs could become larger in 

physical size. 

DOE requests comment on if 

manufacturers would have the 

engineering capacity to conduct design 

efforts to be able to offer a full portfolio 

of compliant ESEMs at TSL 3. If not, 

please provide any data or information 

on the potential impacts that could arise 

due to these market gaps in equipment 

offerings. 

Under 42 U.S.C. 6316(a) and 42 U.S.C. 

6295(o)(2)(B)(i), DOE determines 

whether a standard is economically 

justified after considering seven factors. 

Based on these factors, the Secretary 

tentatively concludes that at TSL 3 for 

ESEMs, the benefits of energy savings, 

the economic benefit on many 

consumers, positive NPV of consumer 

benefits, emission reductions, and the 

estimated monetary value of the 

emissions reductions would be 

outweighed by the impacts on 

manufacturers, including the extremely 

large conversion costs (representing 

over 1.7 times the sum of the annual 

free cash flows during the time period 

that these conversion costs will be 

incurred and over 55 percent of the 

entire no-new-standards case INPV), 

profitability impacts that could result in 

a large reduction in INPV (up to a 

decrease of 48.7 percent), the large 

negative free cash flows in the years 

leading up to the compliance date 

(annual free cash flow is estimated to be 

¥$313 million in the year before the 

compliance date), the lack of 

manufacturers currently offering 

equipment meeting the efficiency levels 

required at this TSL (models 

representing approximately 91 percent 

of shipments will need to be redesigned 

to meet this TSL), and the likelihood of 

the significant disruption in the ESEM 

market. Due to the limited amount of 

engineering resources each 

manufacturer has, it is unclear if most 

manufacturers will be able to redesign 

models representing on average 91 

percent of their ESEM shipments 

covered by this rulemaking in the 4-year 

compliance period. Consequently, the 

Secretary has tentatively concluded that 

TSL 3 is not economically justified. 

DOE then considered TSL 2, the 

standards level recommended in the 

December 2022 Joint Recommendation, 

which represents EL 2 for all equipment 

class groups. TSL 2 would save an 

estimated 8.9 quads of energy, an 

amount DOE considers significant. 

Under TSL 2, the NPV of consumer 

benefit would be $21.0 billion using a 

discount rate of 7 percent and $45.0 

billion using a discount rate of 3 

percent. 

The cumulative emissions reductions 

at TSL 2 are 160.5 Mt of CO2, 299.8 

thousand tons of SO2, 43.8 thousand 

tons of NOX, 0.3 tons of Hg, 1,362.2 

thousand tons of CH4, and 1.4 thousand 

tons of N2O. The estimated monetary 

value of the climate benefits from 

reduced GHG emissions (associated 

with the average SC–GHG at a 3-percent 

discount rate) at TSL 2 is $9.4 billion. 

The estimated monetary value of the 

health benefits from reduced SO2 and 

NOX emissions at TSL 2 is $7.9 billion 

using a 7-percent discount rate and 

$18.3 billion using a 3-percent discount 

rate. 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87133 

102The sum of annual free cash flows is estimated 

to be $636 million for 2025–2028 in the no-newstandards case and the no-new-standards case INPV 

is estimated to be $2,019 million. 103See EERE–2020–BT–STD–0007–0038 at p. 4. 

Using a 7-percent discount rate for 

consumer benefits and costs, health 

benefits from reduced SO2 and NOX

emissions, and the 3-percent discount 

rate case for climate benefits from 

reduced GHG emissions, the estimated 

total NPV at TSL 2 is $38.3 billion. 

Using a 3-percent discount rate for all 

benefits and costs, the estimated total 

NPV at TSL 2 is $72.8 billion. The 

estimated total NPV is provided for 

additional information, however DOE 

primarily relies upon the NPV of 

consumer benefits when determining 

whether a standard level is 

economically justified. 

At TSL 2, the average LCC impact for 

non-air over ESEMs is a savings of $51 

and $138 for high/medium torque 

ESEMs (0.25 and 1 hp, respectively); 

$147 and $100 for low torque ESEMs 

(0.25 and 0.5 hp, respectively); and $26 

for Polyphase ESEMs. At TSL 2, the 

average LCC impact for AO–ESEMs is a 

savings of $83 and $160 for high/ 

medium torque AO–ESEMs (0.25 and 1 

hp, respectively); $121 and $88 for low 

torque AO–ESEMs (0.25 and 0.5 hp, 

respectively); and $40 for Polyphase 

AO–ESEMs. Overall, the shipmentsweighted average LCC impact is a 

savings of $102. The simple payback 

period for non-air-over ESEMs is 1.1 

and 0.9 years for high/medium torque 

ESEMs (0.25 and 1 hp, respectively); 0.7 

and 1.5 years for low torque ESEMs 

(0.25 and 0.5 hp, respectively); and 2.0 

years for polyphase ESEMs. The simple 

payback period for AO–ESEMs is 0.8 

and 0.8 years for high/medium torque 

AO–ESEMs (0.25 and 1 hp, 

respectively); 0.7 and 1.3 years for low 

torque AO–ESEMs (0.25 and 0.5 hp, 

respectively); and 1.8 years for 

polyphase AO–ESEMs. Overall, the 

shipments-weighted average PBP is 1.2 

years. The fraction of consumers 

experiencing a net LCC cost, for non-airover ESEMs is 16.7 and 11.7 percent for 

high/medium torque ESEMs (0.25 and 1 

hp, respectively); 3.0 and 7.8 percent for 

low torque ESEMs (0.25 and 0.5 hp, 

respectively); and 7.2 percent for 

polyphase ESEMs. The fraction of 

consumers experiencing a net LCC cost 

for AO–ESEMs is 7.8 and 5.9 percent for 

high/medium torque AO–ESEMs (0.25 

and 1 hp, respectively); 3.7 and 2.9 

percent for low torque AO–ESEMs (0.25 

and 0.5 hp, respectively); and 9.7 

percent for polyphase AO–ESEMs. 

Overall, the shipments-weighted 

average fraction of consumers 

experiencing a net LCC cost is 7.8 

percent. 

At TSL 2, the projected change in 

INPV ranges from a decrease of $264 

million to a decrease of $131 million, 

which corresponds to decreases of 13.1 

percent and 6.5 percent, respectively. 

DOE estimates that industry must invest 

$339 million to comply with standards 

set at TSL 2. An investment of $339 

million in conversion costs represents 

approximately 53 percent of the sum of 

the annual free cash flows over the years 

between the expected publication date 

of the final rule and the standards year 

(i.e., the time period that these 

conversion costs would be incurred) 

and represents approximately 17 

percent of the entire no-new-standards 

case INPV over the 30-year analysis 

period.102

Under 42 U.S.C. 6316(a) and 42 U.S.C. 

6295(o)(2)(B)(i), DOE determines 

whether a standard is economically 

justified after considering seven factors. 

After considering the seven factors and 

weighing the benefits and burdens, the 

Secretary has tentatively concluded that 

standards set at TSL 2, the 

recommended TSL from the Electric 

Motors Working Group, for ESEMs 

would be economically justified. At this 

TSL, the average LCC savings for all 

equipment classes is positive. An 

estimated 7.8 percent of ESEM 

consumers experience a net cost. The 

FFC national energy savings are 

significant and the NPV of consumer 

benefits is positive using both a 3- 

percent and 7-percent discount rate. 

Notably, the benefits to consumers 

vastly outweigh the cost to 

manufacturers. At TSL 2, the NPV of 

consumer benefits, even measured at the 

more conservative discount rate of 7 

percent is over 79 times higher than the 

maximum estimated manufacturers’ loss 

in INPV. The proposed standard levels 

at TSL 2 are economically justified even 

without weighing the estimated 

monetary value of emissions reductions. 

When those emissions reductions are 

included—representing $9.4 billion in 

climate benefits (associated with the 

average SC–GHG at a 3-percent discount 

rate), and $18.3 billion (using a 3- 

percent discount rate) or $7.9 billion 

(using a 7-percent discount rate) in 

health benefits—the rationale becomes 

stronger still. 

Accordingly, the Secretary has 

tentatively concluded that TSL 2, the 

TSL recommended by the Electric 

Motors Working Group, would offer the 

maximum improvement in efficiency 

that is technologically feasible and 

economically justified and would result 

in the significant conservation of 

energy. In addition, as discussed in 

section V.A of this document, DOE is 

establishing the TSLs by equipment 

class groups and aligning the AO–ESEM 

levels with the non-AO–ESEMs. 

Although results are presented here in 

terms of TSLs, DOE analyzes and 

evaluates all possible ELs for each 

equipment class in its analysis. For all 

equipment classes, TSL 2 is comprised 

of EL 2, and represents two levels below 

max-tech. The max tech efficiency 

levels (TSL 4) result in negative LCC 

savings for most equipment classes and 

a large percentage of consumers that 

experience a net LCC cost for most 

equipment classes, in addition to 

significant manufacturer impacts. The 

ELs one level below max tech (TSL 3) 

result in negative LCC savings for some 

equipment classes and a large 

percentage of consumers that experience 

a net LCC cost for most equipment 

classes. Additionally, the impact to 

manufacturers is significantly reduced 

at TSL 2. While manufacturers will have 

to invest $339 million to comply with 

standards at TSL 2, annual free cash 

flows remain positive for all years 

leading up to the modeled compliance 

date. DOE also estimates that most 

ESEM manufacturers will have the 

engineering capacity to complete these 

redesigns in a 4-year compliance period. 

Lastly, as discussed in the December 

2022 Joint Recommendation,103 TSL 2 

would not result in ESEMs significantly 

increasing in physical size and therefore 

would not result in a significant and 

widespread disruption to the OEM 

markets that used ESEMs as an 

embedded product. 

The ELs two levels below max-tech 

(TSL 2), which represents the proposed 

standard levels as recommended by the 

Electric Motors Working Group, result 

in positive LCC savings for all 

equipment classes, significantly reduce 

the number of consumers experiencing 

a net cost, and reduce the decrease in 

INPV and conversion costs to the point 

where DOE has tentatively concluded 

they are economically justified, as 

discussed for TSL 2 in the preceding 

paragraphs. 

As presented in section V.A in this 

document, DOE developed TSLs that 

aligned the efficiency levels for air-over 

and non-air-over ESEMs because of the 

similarities in the manufacturing 

processes between air-over and non-airover ESEMs. In some cases, an air-over 

ESEM could be manufactured on the 

same line as a non-air-over ESEM by 

omitting the steps of manufacturing 

associated with the fan of a motor. 

While DOE did not explicitly analyze 

a TSL that would require TSL 3 

efficiency levels for AO–ESEMs and 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87134 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TSL 2 efficiency levels for non-air over 

ESEMs, DOE may consider this 

alternative combination for any 

potential final rule. In that case, DOE 

seeks feedback on the potential 

consequences of adopting a moreefficient level of AO–ESEMs as 

compared to non-air over ESEMs. DOE 

seeks information about whether there 

would be any decrease in the shipments 

of AO–ESEMs (and a decrease in the 

potential benefits from a more efficient 

proposed standard at TSL 3 efficiency 

levels for AO–ESEMs) by shifting the 

market to predominantly non-air over 

ESEMs. In such a scenario, the savings 

associated with this TSL option may 

never be realized. In addition, while 

DOE did not consider a TSL that would 

require TSL 2 for all equipment classes 

except TSL3 efficiency levels for low 

torque ESEMs (both air-over and nonair-over) due to the uncertainties as to 

whether the size, fit and function would 

be maintained and potential significant 

and widespread disruption to the OEM 

markets, DOE seeks information related 

to potential size increase and impact on 

OEM markets at TSL 3 and above. 

DOE seeks comment on these 

alternative proposed standard levels. 

DOE requests comment on the 

unintended market consequences and 

the changes industry would make as a 

result of standards that require the use 

of different motor technologies for nonair over and AO–ESEMs. In addition, if 

DOE were to consider a TSL that would 

require TSL 2 for all equipment classes 

except TSL3 efficiency levels for low 

torque ESEMs, DOE seeks information 

related to potential ESEM size increase 

and impact on OEM markets at TSL 3 

and above. 

As stated, DOE conducts the walkdown analysis to determine the TSL that 

represents the maximum improvement 

in energy efficiency that is 

technologically feasible and 

economically justified as required under 

EPCA. The walk-down is not a 

comparative analysis, as a comparative 

analysis would result in the 

maximization of net benefits instead of 

energy savings that are technologically 

feasible and economically justified, 

which would be contrary to EPCA. 86 

FR 70892, 70908 (Dec. 12, 2021). 

Although DOE has not conducted a 

comparative analysis to select the 

proposed new energy conservation 

standards, DOE notes that as compared 

to TSL 3 and TSL 4, TSL 2 has higher 

average LCC savings for consumers, 

significantly smaller percentages of 

consumers experiencing a net cost, a 

lower maximum decrease in INPV, 

lower manufacturer conversion costs, 

and a significant decrease in the 

likelihood of a major disruption to the 

both the ESEM market and the OEM 

markets that use ESEMs as an embedded 

product in their equipment, as DOE 

does not anticipate gaps in ESEM 

equipment offerings or a significant 

increase in the physical size of ESEMs 

at TSL 2. 

Although DOE considered proposing 

new standard levels for ESEMs by 

grouping the efficiency levels for each 

equipment class into TSLs, DOE 

evaluates all analyzed efficiency levels 

in its analysis. For all equipment 

classes, TSL 2 represents the maximum 

energy savings that does not result in 

significant negative economic impacts 

to ESEM manufacturers. At TSL 2, 

conversion costs are estimated to be 

$339 million, significantly less than at 

TSL 3 ($1,118 million) or at TSL 4 

($2,156 million). At TSL 2, conversion 

costs represent a significantly smaller 

size of the sum of ESEM manufacturers’ 

annual free cash flows for 2025 to 2028 

(53 percent), than at TSL 3 (176 percent) 

or at TSL 4 (339 percent) and a 

significantly smaller portion of ESEM 

manufacturers’ no-new-standards case 

INPV (17 percent), than at TSL 3 (55 

percent) or at TSL 4 (107 percent). At 

TSL 2, ESEM manufacturers will have to 

redesign a significantly smaller portion 

of their ESEM models to meet the ELs 

set at TSL 2 (models representing 55 

percent of all ESEM shipments), than at 

TSL 3 (91 percent) or at TSL 4 (99 

percent). Lastly, ESEM manufacturers’ 

free cash flow remains positive at TSL 

2 for all years leading up to the 

compliance date. Whereas at TSL 3 

annual free cash flow is estimated to be 

¥$313 million and at TSL 4 annual free 

cash flow is estimated to be ¥$764 

million in 2028, the year before the 

compliance year. Additionally, the ELs 

at the proposed TSL result in average 

positive LCC savings for all equipment 

class groups and significantly reduce 

the number of consumers experiencing 

a net cost to the point where DOE has 

tentatively concluded they are 

economically justified, as discussed for 

TSL 2 in the preceding paragraphs. 

Therefore, based on the previous 

considerations, DOE proposes to adopt 

the energy conservation standards for 

ESEMs at TSL 2, which was the 

recommended TSL by the Electric 

Motors Working Group. The proposed 

energy conservation standards for 

ESEMs, which are expressed as average 

full-load efficiency, are shown in Table 

V–44 through Table V–46. 

TABLE V–44—PROPOSED ENERGY CONSERVATION STANDARDS FOR HIGH AND MEDIUM-TORQUE ESEMS

hp 

Average full load efficiency 

Open Enclosed 

2-pole 4-pole 6-pole 8-pole 2-pole 4-pole 6-pole 8-pole 

0.25 .................................................................. 59.5 59.5 57.5 ................ 59.5 59.5 57.5 ................

0.33 .................................................................. 64.0 64.0 62.0 50.5 64.0 64.0 62.0 50.5 

0.5 .................................................................... 68.0 69.2 68.0 52.5 68.0 67.4 68.0 52.5 

0.75 .................................................................. 76.2 81.8 80.2 72.0 75.5 75.5 75.5 72.0 

1 ....................................................................... 80.4 82.6 81.1 74.0 77.0 80.0 77.0 74.0 

1.5 .................................................................... 81.5 83.8 ................ ................ 81.5 81.5 80.0 ................

2 ....................................................................... 82.9 84.5 ................ ................ 82.5 82.5 ................ ................

3 ....................................................................... 84.1 ................ ................ ................ 84.0 ................ ................ ................


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87135 

TABLE V–45—PROPOSED ENERGY CONSERVATION STANDARDS FOR LOW-TORQUE ESEMS

hp 

Average full load efficiency 

Open Enclosed 

2-pole 4-pole 6-pole 8-pole 2-pole 4-pole 6-pole 8-pole 

0.25 .................................................................. 63.9 66.1 60.2 52.5 60.9 64.1 59.2 52.5 

0.33 .................................................................. 66.9 69.7 65.0 56.6 63.9 67.7 64.0 56.6 

0.5 .................................................................... 68.8 70.1 66.8 57.1 65.8 68.1 65.8 57.1 

0.75 .................................................................. 70.5 74.8 73.1 62.8 67.5 72.8 72.1 62.8 

1 ....................................................................... 74.3 77.1 77.3 65.7 71.3 75.1 76.3 65.7 

1.5 .................................................................... 79.9 82.1 80.5 72.2 76.9 80.1 79.5 72.2 

2 ....................................................................... 81.0 82.9 81.4 73.3 78.0 80.9 80.4 73.3 

3 ....................................................................... 82.4 84.0 82.5 74.9 79.4 82.0 81.5 74.9 

TABLE V–46—PROPOSED ENERGY CONSERVATION STANDARDS FOR POLYPHASE ESEMS

hp 

Average full load efficiency 

Open Enclosed 

2-pole 4-pole 6-pole 8-pole 2-pole 4-pole 6-pole 8-pole 

0.25 .................................................................. 65.6 69.5 67.5 62.0 66.0 68.0 66.0 62.0 

0.33 .................................................................. 69.5 73.4 71.4 64.0 70.0 72.0 70.0 64.0 

0.5 .................................................................... 73.4 78.2 75.3 66.0 72.0 75.5 72.0 66.0 

0.75 .................................................................. 76.8 81.1 81.7 70.0 75.5 77.0 74.0 70.0 

1 ....................................................................... 77.0 83.5 82.5 75.5 75.5 77.0 74.0 75.5 

1.5 .................................................................... 84.0 86.5 83.8 77.0 84.0 82.5 87.5 78.5 

2 ....................................................................... 85.5 86.5 ................ 86.5 85.5 85.5 88.5 84.0 

3 ....................................................................... 85.5 86.9 ................ 87.5 86.5 86.5 89.5 85.5 

2. Annualized Benefits and Costs of the 

Proposed Standards 

The benefits and costs of the proposed 

standards can also be expressed in terms 

of annualized values. The annualized 

net benefit is (1) the annualized national 

economic value (expressed in 2022$) of 

the benefits from operating equipment 

that meet the proposed standards 

(consisting primarily of operating cost 

savings from using less energy, minus 

increases in equipment purchase costs, 

and (2) the annualized monetary value 

of the climate and health benefits from 

emission reductions. 

Table V–47 shows the annualized 

values for ESEMs under TSL 2, 

expressed in 2022$. The results under 

the primary estimate are as follows. 

Using a 7-percent discount rate for 

consumer benefits and costs and NOX

and SO2 reduction benefits, and a 3- 

percent discount rate case for GHG 

social costs, the estimated cost of the 

proposed standards for ESEMs is $543 

million per year in increased equipment 

costs, while the estimated annual 

benefits are $2,757 million in reduced 

product operating costs, $542 million in 

climate benefits, and $836 million in 

health benefits. In this case, the net 

benefit amounts to $3,592 million per 

year. 

Using a 3-percent discount rate for all 

benefits and costs, the estimated cost of 

the proposed standards for ESEMs is 

$556 million per year in increased 

equipment costs, while the estimated 

annual benefits are $3,140 million in 

reduced operating costs, $542 million in 

climate benefits, and $1,052 million in 

health benefits. In this case, the net 

benefit amounts to $4,179 million per 

year. 

TABLE V–47—ANNUALIZED MONETIZED BENEFITS AND COSTS OF PROPOSED STANDARDS FOR ESEMS

[Proposed TSL 2] 

Million 2022$/year 

Primary 

estimate 

Low-netbenefits 

estimate 

High-netbenefits 

estimate 

3% discount rate 

Consumer Operating Cost Savings ............................................................................................. 3,140 2,962 3,341 

Climate Benefits * ......................................................................................................................... 542 526 562 

Health Benefits ** ......................................................................................................................... 1,052 1,021 1,089 

Total Benefits † ............................................................................................................................ 4,734 4,509 4,992 

Consumer Incremental Equipment Costs ‡ ................................................................................. 556 598 529 

Net Benefits ................................................................................................................................. 4,179 3,911 4,464 

Change in Producer Cashflow (INPV ††) .................................................................................... (25)–(13) (25)–(13) (25)–(13) 

7% discount rate 

Consumer Operating Cost Savings ............................................................................................. 2,757 2,615 2,921 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87136 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE V–47—ANNUALIZED MONETIZED BENEFITS AND COSTS OF PROPOSED STANDARDS FOR ESEMS—Continued 

[Proposed TSL 2] 

Million 2022$/year 

Primary 

estimate 

Low-netbenefits 

estimate 

High-netbenefits 

estimate 

Climate Benefits * (3% discount rate) .......................................................................................... 542 526 562 

Health Benefits ** ......................................................................................................................... 836 814 863 

Total Benefits † ............................................................................................................................ 4,135 3,955 4,346 

Consumer Incremental Equipment Costs ‡ ................................................................................. 543 578 520 

Net Benefits ................................................................................................................................. 3,592 3,377 3,826 

Change in Producer Cashflow (INPV ††) .................................................................................... (25)–(13) (25)–(13) (25)–(13) 

Note: This table presents the costs and benefits associated with ESEMs shipped in 2029–2058. These results include consumer, climate, and 

health benefits which accrue after 2058 from the equipment shipped in 2029–2058. The Primary, Low Net Benefits, and High Net Benefits Estimates utilize projections of energy prices from the AEO2023 Reference case, Low Economic Growth case, and High Economic Growth case, respectively. In addition, incremental equipment costs reflect a constant rate in the Primary Estimate, an increasing rate in the Low Net Benefits 

Estimate, and a declining rate in the High Net Benefits Estimate. The methods used to derive projected price trends are explained in sections 

IV.F.1 and IV.H.3 of this document. Note that the Benefits and Costs may not sum to the Net Benefits due to rounding. 

* Climate benefits are calculated using four different estimates of the global SC–GHG (see section IV.L of this notice). For presentational purposes of this table, the climate benefits associated with the average SC–GHG at a 3 percent discount rate are shown, but DOE does not have a 

single central SC–GHG point estimate, and it emphasizes the importance and value of considering the benefits calculated using all four sets of 

SC–GHG estimates. To monetize the benefits of reducing GHG emissions, this analysis uses the interim estimates presented in the Technical 

Support Document: Social Cost of Carbon, Methane, and Nitrous Oxide Interim Estimates Under Executive Order 13990 published in February 

2021 by the IWG. 

** Health benefits are calculated using benefit-per-ton values for NOX and SO2. DOE is currently only monetizing (for SO2 and NOX) PM2.5 precursor health benefits and (for NOX) ozone precursor health benefits, but will continue to assess the ability to monetize other effects such as 

health benefits from reductions in direct PM2.5 emissions. See section IV.L of this document for more details. 

† Total benefits for both the 3-percent and 7-percent cases are presented using the average SC–GHG with 3-percent discount rate, but DOE 

does not have a single central SC–GHG point estimate. 

‡ Costs include incremental equipment costs. 

†† Operating Cost Savings are calculated based on the life cycle costs analysis and national impact analysis as discussed in detail below. See 

sections IV.F and IV.H of this document. DOE’s national impacts analysis includes all impacts (both costs and benefits) along the distribution 

chain beginning with the increased costs to the manufacturer to manufacture the equipment and ending with the increase in price experienced by 

the consumer. DOE also separately conducts a detailed analysis on the impacts on manufacturers (the MIA). See section IV.J of this document. 

In the detailed MIA, DOE models manufacturers’ pricing decisions based on assumptions regarding investments, conversion costs, cashflow, and 

margins. The MIA produces a range of impacts, which is the rule’s expected impact on the INPV. The change in INPV is the present value of all 

changes in industry cash flow, including changes in production costs, capital expenditures, and manufacturer profit margins. The annualized 

change in INPV is calculated using the industry weighted average cost of capital value of 9.1 percent that is estimated in the MIA (see chapter 

12 of the NOPR TSD for a complete description of the industry weighted average cost of capital). For ESEMs, those values are ¥$25 million 

and ¥$13 million. DOE accounts for that range of likely impacts in analyzing whether a TSL is economically justified. See section V.C of this 

document. DOE is presenting the range of impacts to the INPV under two markup scenarios: the Preservation of Gross Margin scenario, which is 

the manufacturer markup scenario used in the calculation of Consumer Operating Cost Savings in this table, and the Preservation of Operating 

Profit Markup scenario, where DOE assumed manufacturers would not be able to increase per-unit operating profit in proportion to increases in 

manufacturer production costs. DOE includes the range of estimated annualized change in INPV in the above table, drawing on the MIA explained further in section IV.J of this document, to provide additional context for assessing the estimated impacts of this rule to society, including 

potential changes in production and consumption, which is consistent with OMB’s Circular A–4 and E.O. 12866. If DOE were to include the INPV 

into the annualized net benefit calculation for this NOPR, the annualized net benefits would range from $4,154 million to $4,166 million at 3-percent discount rate and would range from $3,567 million to $3,579 million at 7-percent discount rate. Numbers in parentheses are negative 

numbers. 

D. Reporting, Certification, and 

Sampling Plan 

Manufacturers, including importers, 

must use equipment-specific 

certification templates to certify 

compliance to DOE. For currently 

regulated electric motors, the 

certification template is specified at 10 

CFR 429.36. DOE is not proposing new 

product-specific certification reporting 

requirements for ESEMs. However, as 

discussed in section III.C of this 

document, DOE proposes to amend the 

determinations of represented values for 

ESEMs. 

VI. Procedural Issues and Regulatory 

Review 

A. Review Under Executive Orders 

12866, 13563, and 14094 

Executive Order (‘‘E.O.’’) 12866, 

‘‘Regulatory Planning and Review,’’ as 

supplemented and reaffirmed by E.O. 

13563, ‘‘Improving Regulation and 

Regulatory Review,’’ 76 FR 3821 (Jan. 

21, 2011) and amended by E.O. 14094, 

‘‘Modernizing Regulatory Review,’’ 88 

FR 21879 (April 11, 2023), requires 

agencies, to the extent permitted by law, 

to (1) propose or adopt a regulation only 

upon a reasoned determination that its 

benefits justify its costs (recognizing 

that some benefits and costs are difficult 

to quantify); (2) tailor regulations to 

impose the least burden on society, 

consistent with obtaining regulatory 

objectives, taking into account, among 

other things, and to the extent 

practicable, the costs of cumulative 

regulations; (3) select, in choosing 

among alternative regulatory 

approaches, those approaches that 

maximize net benefits (including 

potential economic, environmental, 

public health and safety, and other 

advantages; distributive impacts; and 

equity); (4) to the extent feasible, specify 

performance objectives, rather than 

specifying the behavior or manner of 

compliance that regulated entities must 

adopt; and (5) identify and assess 

available alternatives to direct 

regulation, including providing 

economic incentives to encourage the 

desired behavior, such as user fees or 

marketable permits, or providing 

information upon which choices can be 

made by the public. DOE emphasizes as 

well that E.O. 13563 requires agencies to 

use the best available techniques to 

quantify anticipated present and future 

benefits and costs as accurately as 

possible. In its guidance, the Office of 

Information and Regulatory Affairs 

(‘‘OIRA’’) in the Office of Management 

and Budget (‘‘OMB’’) has emphasized 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87137 

that such techniques may include 

identifying changing future compliance 

costs that might result from 

technological innovation or anticipated 

behavioral changes. For the reasons 

stated in the preamble, this proposed 

regulatory action is consistent with 

these principles. 

Section 6(a) of E.O. 12866 also 

requires agencies to submit ‘‘significant 

regulatory actions’’ to OIRA for review. 

OIRA has determined that this proposed 

regulatory action constitutes a 

‘‘significant regulatory action’’ within 

the scope of section 3(f)(1) of E.O. 

12866. Accordingly, pursuant to section 

6(a)(3)(C) of E.O. 12866, DOE has 

provided to OIRA an assessment, 

including the underlying analysis, of 

benefits and costs anticipated from the 

proposed regulatory action, together 

with, to the extent feasible, a 

quantification of those costs; and an 

assessment, including the underlying 

analysis, of costs and benefits of 

potentially effective and reasonably 

feasible alternatives to the planned 

regulation, and an explanation why the 

planned regulatory action is preferable 

to the identified potential alternatives. 

These assessments are summarized in 

this preamble and further detail can be 

found in the technical support 

document for this proposed rulemaking. 

B. Review Under the Regulatory 

Flexibility Act 

The Regulatory Flexibility Act (5 

U.S.C. 601 et seq.) requires preparation 

of an initial regulatory flexibility 

analysis (‘‘IRFA’’) for any rule that by 

law must be proposed for public 

comment, unless the agency certifies 

that the rule, if promulgated, will not 

have a significant economic impact on 

a substantial number of small entities. 

As required by E.O. 13272, ‘‘Proper 

Consideration of Small Entities in 

Agency Rulemaking,’’ 67 FR 53461 

(Aug. 16, 2002), DOE published 

procedures and policies on February 19, 

2003, to ensure that the potential 

impacts of its rules on small entities are 

properly considered during the 

rulemaking process. 68 FR 7990. DOE 

has made its procedures and policies 

available on the Office of the General 

Counsel’s website (www.energy.gov/gc/ 

office-general-counsel). DOE has 

prepared the following IRFA for the 

equipment that are the subject of this 

proposed rulemaking. 

For manufacturers of ESEMs, the 

Small Business Administration (‘‘SBA’’) 

has set a size threshold, which defines 

those entities classified as ‘‘small 

businesses’’ for the purposes of the 

statute. DOE used the SBA’s small 

business size standards to determine 

whether any small entities would be 

subject to the requirements of the rule. 

(See 13 CFR part 121.) The size 

standards are listed by North American 

Industry Classification System 

(‘‘NAICS’’) code and industry 

description and are available at 

www.sba.gov/document/support-tablesize-standards. Manufacturing of ESEMs 

is classified under NAICS 335312, 

‘‘Motor and Generator Manufacturing.’’ 

The SBA sets a threshold of 1,250 

employees or fewer for an entity to be 

considered as a small business for this 

category. 

1. Description of Reasons Why Action Is 

Being Considered 

DOE previously established energy 

conservation standards for some types 

of electric motors at 10 CFR 431.25. 

These previous rulemakings did not 

establish energy conservation standards 

for ESEMs when establishing or 

amending energy conservation 

standards for other electric motors. In 

the March 2022 Preliminary Analysis, 

DOE analyzed potential efficiency levels 

for ESEMs. See 87 FR 11650 (March 2, 

2022). On December 22, 2022, DOE 

received a joint recommendation for 

energy conservation standards for 

ESEMs. These standard levels were 

submitted jointly to DOE, by groups 

representing manufacturers, energy and 

environmental advocates, and consumer 

groups (the Electric Motors Working 

Group). The December 2022 Joint 

Recommendation recommends specific 

energy conservation standards for 

ESEMs. 

2. Objectives of, and Legal Basis for, 

Rule 

EPCA authorizes DOE to regulate the 

energy efficiency of a number of 

consumer products and certain 

industrial equipment. Title III, Part C of 

EPCA, added by Public Law 95–619, 

Title IV, section 441(a) (42 U.S.C. 6311– 

6317, as codified), established the 

Energy Conservation Program for 

Certain Industrial Equipment, which 

sets forth a variety of provisions 

designed to improve the energy 

efficiency of certain types of industrial 

equipment, including ESEMs, a category 

of electric motors, the subject of this 

notice. (42 U.S.C. 6311(1)(A)). 

DOE must follow specific statutory 

criteria for prescribing new or amended 

standards for covered equipment, 

including electric motors. Any new or 

amended standard for covered 

equipment must be designed to achieve 

the maximum improvement in energy 

efficiency that the Secretary of Energy 

determines is technologically feasible 

and economically justified. (42 U.S.C. 

6316(a); 42 U.S.C. 6295(o)(2)(A) and 42 

U.S.C. 6295(o)(3)(B)) 

3. Description and Estimated Number of 

Small Entities Regulated 

To estimate the number of companies 

that could be small business 

manufacturers of ESEMs covered by this 

rulemaking, DOE conducted a market 

survey using publicly available 

information. DOE’s research involved 

DOE’s publicly available Compliance 

Certification Database (‘‘CCD’’), industry 

trade association membership 

directories (including NEMA), and 

information from previous rulemakings. 

DOE also asked stakeholders and 

industry representatives if they were 

aware of any other small manufacturers 

during manufacturer interviews and 

DOE working groups. DOE used 

information from these sources to create 

a list of companies that potentially 

manufacture ESEMs covered by this 

proposed rulemaking. As necessary, 

DOE contacted companies to determine 

whether they met the SBA’s definition 

of a small business manufacturer. DOE 

screened out companies that do not 

offer equipment covered by this 

proposed rulemaking, do not meet the 

definition of a ‘‘small business,’’ or are 

foreign owned and operated. 

DOE initially identified 

approximately 74 unique potential 

manufacturers of ESEMs sold in the U.S 

that are covered by this proposed 

rulemaking. DOE screened out 

companies that had more than 1,250 

employees or companies that were 

completely foreign-owned and operated. 

Of the 74 manufacturers that potentially 

manufacture ESEMs covered by this 

proposed rulemaking, DOE identified 3 

companies that meet SBA’s definition of 

a small business. 

4. Description and Estimate of 

Compliance Requirements Including 

Differences in Cost, if Any, for Different 

Groups of Small Entities 

In this NOPR, DOE is proposing new 

energy conservation standards for 

ESEMs. The primary value added by 

these 3 small businesses is creating 

ESEMs that serve an application specific 

purpose that the OEMs require. This 

includes combining an ESEM with 

specific mechanic couplings, 

weatherproofing, or controls to suit the 

OEM’s needs. Most small businesses 

manufacture motor housing and 

couplings but do not manufacture the 

rotors and stators used in the ESEMs 

they sell. While these small businesses 

may have to create new ESEM housings 

and/or couplings if the ESEM 

characteristics change in response to the 

proposed energy conservation 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87138 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

104 DOE estimated that it would take 

approximately three months of engineering time to 

redesign each ESEM housing. Based on data from 

BLS, the mean hourly wage of an electrical engineer 

is $54.83 (www.bls.gov/oes/current/oes172071.htm) 

and wages comprise 70.5 percent of an employee’s 

total compensation (www.bls.gov/news.release/ 

archives/ecec_06162023.pdf). 

$54.83 (hourly wage) ÷ 0.705 (wage as a 

percentage of total compensation) = $77.77 (fully 

burdened hourly labor rate). 

$77.77 × 8 (hours in a workday) × 20 (working 

days in a month) × 3 (months) = $37,330 

105 app.avention.com. 

standards, DOE was not able to identify 

any small businesses that own their own 

lamination dies sets and winding 

machines that are used to manufacture 

rotors and stators for ESEMs. 

The 3 small businesses identified do 

not manufacture the rotors and stators of 

their ESEMs and instead purchase these 

components from other manufacturers. 

Thus, they would not need to purchase 

the machinery necessary to manufacture 

these components (i.e., would not need 

to purchase costly lamination dies sets 

and winding machines) nor would they 

need to spend R&D efforts to develop 

ESEM designs to meet energy 

conservation standards. Instead, these 

small manufacturers may have to create 

new moldings for ESEM housings (if the 

ESEM characteristics change in 

response to the proposed energy 

conservation standards). 

DOE estimated conversion costs 

associated with redesigning an 

equipment line for ESEM housings. DOE 

estimates this will cost approximately 

$50,000 in molding equipment per 

ESEM housing; $37,330 in engineering 

design effort per ESEM housing; 104 and 

$10,000 in testing costs per ESEM 

housing. Based on these estimates, each 

ESEM housing that will need to be 

redesigned would cost a small business 

approximately $97,330. 

DOE displays in Table VI–1 the 

estimated average conversion costs per 

small business compared to the annual 

revenue for each small business. DOE 

used D&B Hoovers 105 to estimate the 

annual revenue for each small business. 

Manufacturers will have 4 years 

between the expected publication of the 

final rule and the date of compliance 

with the proposed energy conservation 

standards. Therefore, DOE presents the 

estimated conversion costs and testing 

costs as a percent of the estimated 4 

years of annual revenue for each small 

business. 

TABLE VI–1—ESTIMATED CONVERSION COSTS AND ANNUAL REVENUE FOR EACH SMALL BUSINESS

Manufacturer 

Number of 

ESEM 

housing that 

need to be 

redesigned 

Total 

conversion 

costs 

Estimated 

annual 

revenue 

4 Years of 

annual 

revenue 

Conversion 

costs as a % 

of 4 years of 

annual revenue 

Small Business 1 ......................................................................... 27 $2,627,910 $6,270,000 $25,080,000 10.5 

Small Business 2 ......................................................................... 19 1,849,270 10,120,00 40,480,000 4.6 

Small Business 3 ......................................................................... 24 2,335,920 28,210,000 112,840,000 2.1 

Average Small Business ....................................................... 23 2,271,033 14,866,667 59,466,667 3.8 

5. Duplication, Overlap, and Conflict 

With Other Rules and Regulations 

As described in section IV.A. of this 

document, DOE believes the standards 

proposed in this NOPR would not 

impact manufacturers of consumer 

products. In commercial equipment, 

DOE identified the following equipment 

as potentially incorporating ESEMs: 

walk-in coolers and freezers, circulator 

pumps, air circulating fans, and 

commercial unitary air conditioning 

equipment. If the proposed energy 

conservation standards for these rules 

finalize as proposed, DOE has identified 

that these rules would all: (1) have a 

compliance year that is at or before the 

ESEM standard compliance year (2029) 

and/or (2) require a motor that is either 

outside of the scope of this rule (e.g., an 

ECM) or an ESEM with an efficiency 

above the proposed ESEM standards, 

and therefore not be impacted by the 

proposed ESEM rule (i.e., the ESEM rule 

would not trigger a redesign of these 

equipment). 

6. Significant Alternatives to the Rule 

The discussion in the previous 

section analyzes impacts on small 

businesses that would result from DOE’s 

proposal to adopt standards represented 

by TSL 2. In reviewing alternatives to 

the proposed rule, DOE examined 

energy conservation standards set at 

lower efficiency levels. While TSL 1 

would reduce the impacts on small 

business manufacturers, it would come 

at the expense of a reduction in energy 

savings and consumer NPV. TSL 1 

achieves 65 percent lower energy 

savings and 69 percent lower consumer 

NPV compared to the energy savings at 

TSL 2. 

Based on the presented discussion, 

proposing standards at TSL 2 balances 

the benefits of the energy savings at TSL 

2 with the potential burdens placed on 

ESEM manufacturers, including small 

business manufacturers. Accordingly, 

DOE does not propose one of the other 

TSLs considered in the analysis, or the 

other policy alternatives examined as 

part of the regulatory impact analysis 

and included in chapter 17 of the NOPR 

TSD. 

Additional compliance flexibilities 

may be available through other means. 

Manufacturers subject to DOE’s energy 

efficiency standards may apply to DOE’s 

Office of Hearings and Appeals for 

exception relief under certain 

circumstances. Manufacturers should 

refer to 10 CFR part 1003 for additional 

details. 

C. Review Under the Paperwork 

Reduction Act 

Manufacturers of expanded scope 

electric motors must test their 

equipment according to the DOE test 

procedures for ESEMs, including any 

amendments adopted for those test 

procedures, and use the results of the 

test procedure and applicable sampling 

plan if they choose to make 

representations of the energy efficiency 

or energy use of ESEMs. DOE has 

established regulations for 

recordkeeping requirements for all 

covered consumer products and 

commercial equipment, including 

ESEMs. (See generally 10 CFR part 429). 

The collection-of-information 

requirement for the testing and 

recordkeeping is subject to review and 

approval by OMB under the Paperwork 

Reduction Act (‘‘PRA’’). This 

requirement has been approved by OMB 

under OMB control number 1910–1400 

and is in the process of being renewed. 

Public reporting burden is estimated to 

average 35 hours per response, 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87139 

including the time for reviewing 

instructions, searching existing data 

sources, gathering and maintaining the 

data needed, and completing and 

reviewing the collection of information. 

DOE does not currently have 

certification or labeling requirements for 

ESEMs and is not proposing to establish 

either of those as part of this proposed 

rule. Thus, DOE expects the 

recordkeeping requirements associated 

with testing and maintaining test data 

would be less than the average estimate 

per response for this paperwork 

package. 

Currently, DOE is seeking comment 

on DOE’s renewal of its paperwork 

reduction approval under OMB control 

number 1910–1400. See 88 FR 65994 

(Sept. 26, 2023). 

Notwithstanding any other provision 

of the law, no person is required to 

respond to, nor shall any person be 

subject to a penalty for failure to comply 

with, a collection of information subject 

to the requirements of the PRA, unless 

that collection of information displays a 

currently valid OMB Control Number. 

D. Review Under the National 

Environmental Policy Act of 1969 

DOE is analyzing this proposed 

regulation in accordance with the 

National Environmental Policy Act of 

1969 (‘‘NEPA’’) and DOE’s NEPA 

implementing regulations (10 CFR part 

1021). DOE’s regulations include a 

categorical exclusion for rulemakings 

that establish energy conservation 

standards for consumer products or 

industrial equipment. 10 CFR part 1021, 

subpart D, appendix B5.1. DOE 

anticipates that this proposed 

rulemaking qualifies for categorical 

exclusion B5.1 because it is a 

rulemaking that establishes energy 

conservation standards for consumer 

products or industrial equipment, none 

of the exceptions identified in 

categorical exclusion B5.1(b) apply, no 

extraordinary circumstances exist that 

require further environmental analysis, 

and it otherwise meets the requirements 

for application of a categorical 

exclusion. See 10 CFR 1021.410. DOE 

will complete its NEPA review before 

issuing the final rule. 

E. Review Under Executive Order 13132 

E.O. 13132, ‘‘Federalism,’’ 64 FR 

43255 (Aug. 10, 1999), imposes certain 

requirements on Federal agencies 

formulating and implementing policies 

or regulations that preempt state law or 

that have federalism implications. The 

Executive order requires agencies to 

examine the constitutional and statutory 

authority supporting any action that 

would limit the policymaking discretion 

of the states and to carefully assess the 

necessity for such actions. The 

Executive order also requires agencies to 

have an accountable process to ensure 

meaningful and timely input by state 

and local officials in the development of 

regulatory policies that have federalism 

implications. On March 14, 2000, DOE 

published a statement of policy 

describing the intergovernmental 

consultation process it will follow in the 

development of such regulations. 65 FR 

13735. DOE has examined this proposed 

rule and has tentatively determined that 

it would not have a substantial direct 

effect on the states, on the relationship 

between the national government and 

the states, or on the distribution of 

power and responsibilities among the 

various levels of government. EPCA 

governs and prescribes Federal 

preemption of state regulations as to 

energy conservation for the equipment 

that are the subject of this proposed 

rule. States can petition DOE for 

exemption from such preemption to the 

extent, and based on criteria, set forth in 

EPCA. (See 42 U.S.C. 6316(a) and (b); 42 

U.S.C. 6297) Therefore, no further 

action is required by Executive Order 

13132. 

F. Review Under Executive Order 12988 

With respect to the review of existing 

regulations and the promulgation of 

new regulations, section 3(a) of E.O. 

12988, ‘‘Civil Justice Reform,’’ imposes 

on Federal agencies the general duty to 

adhere to the following requirements: 

(1) eliminate drafting errors and 

ambiguity, (2) write regulations to 

minimize litigation, (3) provide a clear 

legal standard for affected conduct 

rather than a general standard, and (4) 

promote simplification and burden 

reduction. 61 FR 4729 (Feb. 7, 1996). 

Regarding the review required by 

section 3(a), section 3(b) of E.O. 12988 

specifically requires that Executive 

agencies make every reasonable effort to 

ensure that the regulation: (1) clearly 

specifies the preemptive effect, if any, 

(2) clearly specifies any effect on 

existing Federal law or regulation, (3) 

provides a clear legal standard for 

affected conduct while promoting 

simplification and burden reduction, (4) 

specifies the retroactive effect, if any, (5) 

adequately defines key terms, and (6) 

addresses other important issues 

affecting clarity and general 

draftsmanship under any guidelines 

issued by the Attorney General. Section 

3(c) of Executive Order 12988 requires 

Executive agencies to review regulations 

in light of applicable standards in 

section 3(a) and section 3(b) to 

determine whether they are met or it is 

unreasonable to meet one or more of 

them. DOE has completed the required 

review and determined that, to the 

extent permitted by law, this proposed 

rule meets the relevant standards of E.O. 

12988. 

G. Review Under the Unfunded 

Mandates Reform Act of 1995 

Title II of the Unfunded Mandates 

Reform Act of 1995 (‘‘UMRA’’) requires 

each Federal agency to assess the effects 

of Federal regulatory actions on state, 

local, and Tribal governments and the 

private sector. Public Law 104–4, 

section 201 (codified at 2 U.S.C. 1531). 

For a proposed regulatory action likely 

to result in a rule that may cause the 

expenditure by state, local, and Tribal 

governments, in the aggregate, or by the 

private sector of $100 million or more 

in any one year (adjusted annually for 

inflation), section 202 of UMRA requires 

a Federal agency to publish a written 

statement that estimates the resulting 

costs, benefits, and other effects on the 

national economy. (2 U.S.C. 1532(a), (b)) 

The UMRA also requires a Federal 

agency to develop an effective process 

to permit timely input by elected 

officers of state, local, and Tribal 

governments on a proposed ‘‘significant 

intergovernmental mandate,’’ and 

requires an agency plan for giving notice 

and opportunity for timely input to 

potentially affected small governments 

before establishing any requirements 

that might significantly or uniquely 

affect them. On March 18, 1997, DOE 

published a statement of policy on its 

process for intergovernmental 

consultation under UMRA. 62 FR 

12820. DOE’s policy statement is also 

available at www.energy.gov/sites/prod/ 

files/gcprod/documents/umra_97.pdf. 

Although this proposed rule does not 

contain a Federal intergovernmental 

mandate, it may require expenditures of 

$100 million or more in any one year by 

the private sector. Such expenditures 

may include: (1) investment in research 

and development and in capital 

expenditures by ESEM manufacturers in 

the years between the final rule and the 

compliance date for the new standards 

and (2) incremental additional 

expenditures by consumers to purchase 

higher-efficiency ESEMs, starting at the 

compliance date for the applicable 

standard. 

Section 202 of UMRA authorizes a 

Federal agency to respond to the content 

requirements of UMRA in any other 

statement or analysis that accompanies 

the proposed rule. (2 U.S.C. 1532(c)) 

The content requirements of section 

202(b) of UMRA relevant to a private 

sector mandate substantially overlap the 

economic analysis requirements that 

apply under section 325(o) of EPCA and 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87140 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

106The 2007 ‘‘Energy Conservation Standards 

Rulemaking Peer Review Report’’ is available at the 

following website: energy.gov/eere/buildings/ 

downloads/energy-conservation-standardsrulemaking-peer-review-report-0 (last accessed 

October 10, 2023). 

107The report is available at 

www.nationalacademies.org/our-work/review-ofmethods-for-setting-building-and-equipmentperformance-standards. 

Executive Order 12866. The 

SUPPLEMENTARY INFORMATION section of 

this NOPR and the TSD for this 

proposed rule respond to those 

requirements. 

Under section 205 of UMRA, DOE is 

obligated to identify and consider a 

reasonable number of regulatory 

alternatives before promulgating a rule 

for which a written statement under 

section 202 is required. (2 U.S.C. 

1535(a)) DOE is required to select from 

those alternatives the most cost-effective 

and least burdensome alternative that 

achieves the objectives of the proposed 

rule unless DOE publishes an 

explanation for doing otherwise, or the 

selection of such an alternative is 

inconsistent with law. As required by 42 

U.S.C. 6316(a) and 42 U.S.C. 6295(o), 

this proposed rule would establish new 

energy conservation standards for that 

are designed to achieve the maximum 

improvement in energy efficiency that 

DOE has determined to be both 

technologically feasible and 

economically justified. A full discussion 

of the alternatives considered by DOE is 

presented in chapter 17 of the TSD for 

this proposed rule. 

H. Review Under the Treasury and 

General Government Appropriations 

Act, 1999 

Section 654 of the Treasury and 

General Government Appropriations 

Act, 1999 (Pub. L. 105–277) requires 

Federal agencies to issue a Family 

Policymaking Assessment for any rule 

that may affect family well-being. This 

proposed rule would not have any 

impact on the autonomy or integrity of 

the family as an institution. 

Accordingly, DOE has concluded that it 

is not necessary to prepare a Family 

Policymaking Assessment. 

I. Review Under Executive Order 12630 

Pursuant to E.O. 12630, 

‘‘Governmental Actions and Interference 

with Constitutionally Protected Property 

Rights,’’ 53 FR 8859 (Mar. 15, 1988), 

DOE has determined that this proposed 

rule would not result in any takings that 

might require compensation under the 

Fifth Amendment to the U.S. 

Constitution. 

J. Review Under the Treasury and 

General Government Appropriations 

Act, 2001 

Section 515 of the Treasury and 

General Government Appropriations 

Act, 2001 (44 U.S.C. 3516 note) provides 

for Federal agencies to review most 

disseminations of information to the 

public under information quality 

guidelines established by each agency 

pursuant to general guidelines issued by 

OMB. OMB’s guidelines were published 

at 67 FR 8452 (Feb. 22, 2002), and 

DOE’s guidelines were published at 67 

FR 62446 (Oct. 7, 2002). Pursuant to 

OMB Memorandum M–19–15, 

Improving Implementation of the 

Information Quality Act (April 24, 

2019), DOE published updated 

guidelines which are available at 

www.energy.gov/sites/prod/files/2019/ 

12/f70/DOE%20Final%

20Updated%20IQA%20Guidelines%20

Dec%202019.pdf. DOE has reviewed 

this NOPR under the OMB and DOE 

guidelines and has concluded that it is 

consistent with applicable policies in 

those guidelines. 

K. Review Under Executive Order 13211 

E.O. 13211, ‘‘Actions Concerning 

Regulations That Significantly Affect 

Energy Supply, Distribution, or Use,’’ 66 

FR 28355 (May 22, 2001), requires 

Federal agencies to prepare and submit 

to OIRA at OMB, a Statement of Energy 

Effects for any proposed significant 

energy action. A ‘‘significant energy 

action’’ is defined as any action by an 

agency that promulgates or is expected 

to lead to promulgation of a final rule, 

and that (1) is a significant regulatory 

action under Executive Order 12866, or 

any successor order; and (2) is likely to 

have a significant adverse effect on the 

supply, distribution, or use of energy, or 

(3) is designated by the Administrator of 

OIRA as a significant energy action. For 

any proposed significant energy action, 

the agency must give a detailed 

statement of any adverse effects on 

energy supply, distribution, or use 

should the proposal be implemented, 

and of reasonable alternatives to the 

action and their expected benefits on 

energy supply, distribution, and use. 

DOE has tentatively concluded that 

this proposed regulatory action, which 

proposes new energy conservation 

standards for ESEMs, is not a significant 

energy action because the proposed 

standards are not likely to have a 

significant adverse effect on the supply, 

distribution, or use of energy, nor has it 

been designated as such by the 

Administrator at OIRA. Accordingly, 

DOE has not prepared a Statement of 

Energy Effects on this proposed rule. 

L. Information Quality 

On December 16, 2004, OMB, in 

consultation with the Office of Science 

and Technology Policy (‘‘OSTP’’), 

issued its Final Information Quality 

Bulletin for Peer Review (‘‘the 

Bulletin’’). 70 FR 2664 (Jan. 14, 2005). 

The Bulletin establishes that certain 

scientific information shall be peer 

reviewed by qualified specialists before 

it is disseminated by the Federal 

Government, including influential 

scientific information related to agency 

regulatory actions. The purpose of the 

bulletin is to enhance the quality and 

credibility of the Government’s 

scientific information. Under the 

Bulletin, the energy conservation 

standards rulemaking analyses are 

‘‘influential scientific information,’’ 

which the Bulletin defines as ‘‘scientific 

information the agency reasonably can 

determine will have, or does have, a 

clear and substantial impact on 

important public policies or private 

sector decisions.’’ 70 FR 2664, 2667. 

In response to OMB’s Bulletin, DOE 

conducted formal peer reviews of the 

energy conservation standards 

development process and the analyses 

that are typically used and has prepared 

a report describing that peer review.106

Generation of this report involved a 

rigorous, formal, and documented 

evaluation using objective criteria and 

qualified and independent reviewers to 

make a judgment as to the technical/ 

scientific/business merit, the actual or 

anticipated results, and the productivity 

and management effectiveness of 

programs and/or projects. Because 

available data, models, and 

technological understanding have 

changed since 2007, DOE has engaged 

with the National Academy of Sciences 

to review DOE’s analytical 

methodologies to ascertain whether 

modifications are needed to improve 

DOE’s analyses. DOE is in the process 

of evaluating the resulting report.107

VII. Public Participation 

A. Attendance at the Public Meeting 

The time, date, and location of the 

public meeting are listed in the DATES

and ADDRESSES sections at the beginning 

of this document. If you plan to attend 

the public meeting, please notify the 

Appliance and Equipment Standards 

staff at (202) 287–1445 or Appliance_

Standards_Public_Meetings@ee.doe.gov. 

Please note that foreign nationals 

visiting DOE Headquarters are subject to 

advance security screening procedures 

which require advance notice prior to 

attendance at the public meeting. If a 

foreign national wishes to participate in 

the public meeting, please inform DOE 

of this fact as soon as possible by 

contacting Ms. Regina Washington at 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87141 

(202) 586–1214 or by email 

(Regina.Washington@ee.doe.gov) so that 

the necessary procedures can be 

completed. 

DOE requires visitors to have laptops 

and other devices, such as tablets, 

checked upon entry into the Forrestal 

Building. Any person wishing to bring 

these devices into the building will be 

required to obtain a property pass. 

Visitors should avoid bringing these 

devices, or allow an extra 45 minutes to 

check in. Please report to the visitor’s 

desk to have devices checked before 

proceeding through security. 

Due to the REAL ID Act implemented 

by the Department of Homeland 

Security (‘‘DHS’’), there have been 

recent changes regarding ID 

requirements for individuals wishing to 

enter Federal buildings from specific 

states and U.S. territories. DHS 

maintains an updated website 

identifying the state and territory 

driver’s licenses that currently are 

acceptable for entry into DOE facilities 

at www.dhs.gov/real-id-enforcementbrief. A driver’s licenses from a state or 

territory identified as not compliant by 

DHS will not be accepted for building 

entry and one of the alternate forms of 

ID listed below will be required. 

Acceptable alternate forms of Photo-ID 

include U.S. Passport or Passport Card; 

an Enhanced Driver’s License or 

Enhanced ID-Card issued by states and 

territories as identified on the DHS 

website (Enhanced licenses issued by 

these states and territories are clearly 

marked Enhanced or Enhanced Driver’s 

License); a military ID or other Federal 

Government-issued Photo-ID card. 

In addition, you can attend the public 

meeting via webinar. Webinar 

registration information, participant 

instructions, and information about the 

capabilities available to webinar 

participants will be published on DOE’s 

website at www.eere.energy.gov/ 

buildings/appliance_standards/ 

product.aspx/productid/50. Participants 

are responsible for ensuring their 

systems are compatible with the 

webinar software. 

B. Procedure for Submitting Prepared 

General Statements for Distribution 

Any person who has plans to present 

a prepared general statement may 

request that copies of his or her 

statement be made available at the 

public meeting. Such persons may 

submit requests, along with an advance 

electronic copy of their statement in 

PDF (preferred), Microsoft Word or 

Excel, WordPerfect, or text (ASCII) file 

format, to the appropriate address 

shown in the ADDRESSES section at the 

beginning of this document. The request 

and advance copy of statements must be 

received at least one week before the 

public meeting and are to be emailed. 

Please include a telephone number to 

enable DOE staff to make follow-up 

contact, if needed. 

C. Conduct of the Public Meeting 

DOE will designate a DOE official to 

preside at the public meeting and may 

also use a professional facilitator to aid 

discussion. The meeting will not be a 

judicial or evidentiary-type public 

hearing, but DOE will conduct it in 

accordance with section 336 of EPCA. 

(42 U.S.C. 6306) A court reporter will be 

present to record the proceedings and 

prepare a transcript. DOE reserves the 

right to schedule the order of 

presentations and to establish the 

procedures governing the conduct of the 

public meeting. There shall not be 

discussion of proprietary information, 

costs or prices, market share, or other 

commercial matters regulated by U.S. 

anti-trust laws. After the public meeting, 

interested parties may submit further 

comments on the proceedings, as well 

as on any aspect of the proposed 

rulemaking, until the end of the 

comment period. 

The public meeting will be conducted 

in an informal, conference style. DOE 

will present a general overview of the 

topics addressed in this rulemaking, 

allow time for prepared general 

statements by participants, and 

encourage all interested parties to share 

their views on issues affecting this 

proposed rulemaking. Each participant 

will be allowed to make a general 

statement (within time limits 

determined by DOE), before the 

discussion of specific topics. DOE will 

allow, as time permits, other 

participants to comment briefly on any 

general statements. 

At the end of all prepared statements 

on a topic, DOE will permit participants 

to clarify their statements briefly. 

Participants should be prepared to 

answer questions by DOE and by other 

participants concerning these issues. 

DOE representatives may also ask 

questions of participants concerning 

other matters relevant to this proposed 

rulemaking. The official conducting the 

public meeting will accept additional 

comments or questions from those 

attending, as time permits. The 

presiding official will announce any 

further procedural rules or modification 

of the previous procedures that may be 

needed for the proper conduct of the 

public meeting. 

A transcript of the public meeting will 

be included in the docket, which can be 

viewed as described in the Docket 

section at the beginning of this 

document and will be accessible on the 

DOE website. In addition, any person 

may buy a copy of the transcript from 

the transcribing reporter. 

D. Submission of Comments 

DOE will accept comments, data, and 

information regarding this proposed 

rule before or after the public meeting, 

but no later than the date provided in 

the DATES section at the beginning of 

this proposed rule. Interested parties 

may submit comments, data, and other 

information using any of the methods 

described in the ADDRESSES section at 

the beginning of this document. 

Submitting comments via 

www.regulations.gov. The 

www.regulations.gov web page will 

require you to provide your name and 

contact information. Your contact 

information will be viewable to DOE 

Building Technologies staff only. Your 

contact information will not be publicly 

viewable except for your first and last 

names, organization name (if any), and 

submitter representative name (if any). 

If your comment is not processed 

properly because of technical 

difficulties, DOE will use this 

information to contact you. If DOE 

cannot read your comment due to 

technical difficulties and cannot contact 

you for clarification, DOE may not be 

able to consider your comment. 

However, your contact information 

will be publicly viewable if you include 

it in the comment itself or in any 

documents attached to your comment. 

Any information that you do not want 

to be publicly viewable should not be 

included in your comment, nor in any 

document attached to your comment. 

Otherwise, persons viewing comments 

will see only first and last names, 

organization names, correspondence 

containing comments, and any 

documents submitted with the 

comments. 

Do not submit to www.regulations.gov 

information for which disclosure is 

restricted by statute, such as trade 

secrets and commercial or financial 

information (hereinafter referred to as 

Confidential Business Information 

(‘‘CBI’’)). Comments submitted through 

www.regulations.gov cannot be claimed 

as CBI. Comments received through the 

website will waive any CBI claims for 

the information submitted. For 

information on submitting CBI, see the 

Confidential Business Information 

section. 

DOE processes submissions made 

through www.regulations.gov before 

posting. Normally, comments will be 

posted within a few days of being 

submitted. However, if large volumes of 

comments are being processed 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87142 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

simultaneously, your comment may not 

be viewable for up to several weeks. 

Please keep the comment tracking 

number that www.regulations.gov 

provides after you have successfully 

uploaded your comment. 

Submitting comments via email, hand 

delivery/courier, or postal mail. 

Comments and documents submitted 

via email, hand delivery/courier, or 

postal mail also will be posted to 

www.regulations.gov. If you do not want 

your personal contact information to be 

publicly viewable, do not include it in 

your comment or any accompanying 

documents. Instead, provide your 

contact information in a cover letter. 

Include your first and last names, email 

address, telephone number, and 

optional mailing address. The cover 

letter will not be publicly viewable as 

long as it does not include any 

comments. 

Include contact information each time 

you submit comments, data, documents, 

and other information to DOE. If you 

submit via postal mail or hand delivery/ 

courier, please provide all items on a 

CD, if feasible, in which case it is not 

necessary to submit printed copies. No 

telefacsimiles (‘‘faxes’’) will be 

accepted. 

Comments, data, and other 

information submitted to DOE 

electronically should be provided in 

PDF (preferred), Microsoft Word or 

Excel, WordPerfect, or text (ASCII) file 

format. Provide documents that are not 

secured, that are written in English, and 

that are free of any defects or viruses. 

Documents should not contain special 

characters or any form of encryption 

and, if possible, they should carry the 

electronic signature of the author. 

Campaign form letters. Please submit 

campaign form letters by the originating 

organization in batches of between 50 to 

500 form letters per PDF or as one form 

letter with a list of supporters’ names 

compiled into one or more PDFs. This 

reduces comment processing and 

posting time. 

Confidential Business Information. 

Pursuant to 10 CFR 1004.11, any person 

submitting information that he or she 

believes to be confidential and exempt 

by law from public disclosure should 

submit via email two well-marked 

copies: one copy of the document 

marked ‘‘confidential’’ including all the 

information believed to be confidential, 

and one copy of the document marked 

‘‘non-confidential’’ with the information 

believed to be confidential deleted. DOE 

will make its own determination about 

the confidential status of the 

information and treat it according to its 

determination. 

It is DOE’s policy that all comments 

may be included in the public docket, 

without change and as received, 

including any personal information 

provided in the comments (except 

information deemed to be exempt from 

public disclosure). 

E. Issues on Which DOE Seeks Comment 

Although DOE welcomes comments 

on any aspect of this proposal, DOE is 

particularly interested in receiving 

comments and views of interested 

parties concerning the following issues: 

(1) DOE requests comments on the 

proposal to use a represented value of 

average full-load efficiency for ESEMs 

and proposed revisions to 10 CFR 

429.64 and 429.70(j). 

(2) DOE requests comment on the 

proposed equipment classes for this 

NOPR. 

(3) DOE requests comment on the 

remaining technology options 

considered in this NOPR. 

(4) DOE requests comment on the 

representative units used in this NOPR. 

(5) DOE requests comment on the 

baseline efficiencies used in this NOPR. 

(6) DOE requests comment on the 

proposal to constrain the frame size of 

all efficiency levels to that of the 

baseline unit. 

(7) DOE requests comment on the 

assumption that higher ELs (particularly 

ELs 3 and 4) can be reached without 

significant increase in size. 

(8) DOE requests comment on the 

potential for market disruption at higher 

ELs and if manufacturers could design 

motors at ELs 3 and 4 that do not 

increase in size, or if for the final rule, 

DOE should model motors larger than 

what is considered in this NOPR. 

(9) DOE requests data and information 

to characterize the distribution channels 

for ESEMs and associated market shares. 

(10) DOE requests data and 

information to characterize the 

distribution of ESEMs by sector 

(commercial, industrial, and residential 

sectors) as well as the distribution of 

ESEMs by application in each sector. 

(11) DOE seeks data and additional 

information to characterize ESEM 

operating loads. 

(12) DOE requests comment on the 

distribution of average annual operating 

hours by application and sector used to 

characterize the variability in energy use 

for ESEMs 

(13) DOE seeks data and additional 

information to support the analysis of 

projected energy use impacts related to 

any increases in motor nominal speed. 

(14) DOE requests data and 

information regarding the most 

appropriate price trend to use to project 

ESEM prices. 

(15) DOE requests comment on 

whether any of the efficiency levels 

considered in this NOPR might lead to 

an increase in installation costs, and if 

so, DOE seeks supporting data regarding 

the magnitude of the increased cost per 

unit for each relevant efficiency level 

and the reasons for those differences. 

(16) DOE requests comment on 

whether any of the efficiency levels 

considered in this NOPR might lead to 

an increase in maintenance and repair 

costs, and if so, DOE seeks supporting 

data regarding the magnitude of the 

increased cost per unit for each relevant 

efficiency level and the reasons for 

those differences. 

(17) DOE requests comment on the 

equipment lifetimes (both in years and 

in mechanical hours) used for each 

representative unit considered in the 

LCC and PBP analyses 

(18) DOE seeks information and data 

to help establish efficiency distribution 

in the no-new standards case for ESEMs. 

DOE requests data and information on 

any trends in the electric motor market 

that could be used to forecast expected 

trends in market share by efficiency 

levels for each equipment class. 

(19) DOE requests comment and 

additional data on its 2020 shipments 

estimates for ESEMs. DOE seeks 

comment on the methodology used to 

project future shipments of ESEMs. DOE 

seeks information on other data sources 

that can be used to estimate future 

shipments. 

(20) DOE requests comment and data 

regarding the potential increase in 

utilization of electric motors due to any 

increase in efficiency (‘‘rebound 

effect’’). 

(21) DOE requests comment and data 

on the overall methodology used for the 

consumer subgroup analysis. DOE 

requests comment on whether 

additional consumer subgroups may be 

disproportionately affected by a new 

standard and warrant additional 

analysis in the final rule. 

(22) DOE requests comment on how to 

address the climate benefits and nonmonetized effects of the proposal. 

(23) DOE requests comment on if 

manufacturers would have the 

engineering capacity to conduct design 

efforts to be able to offer a full portfolio 

of complaint ESEM at TSL 4. If not, 

please provide any data or information 

on the potential impacts that could arise 

due to these market gaps in equipment 

offerings. 

(24) DOE requests comment on if 

manufacturers would have the 

engineering capacity to conduct design 

efforts to be able to offer a full portfolio 

of compliant ESEMs at TSL 3. If not, 

please provide any data or information 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87143 

on the potential impacts that could arise 

due to these market gaps in equipment 

offerings. 

(25) DOE seeks comment on these 

alternative proposed standard levels. 

DOE requests comment on the 

unintended market consequences and 

the changes industry would make as a 

result of standards that require the use 

of different motor technologies for nonair over and AO–ESEMs. In addition, if 

DOE were to consider a TSL that would 

require TSL 2 for all equipment classes 

except TSL3 efficiency levels for low 

torque ESEMs, DOE seeks information 

related to potential ESEM size increase 

and impact on OEM markets at TSL 3 

and above. 

Additionally, DOE welcomes 

comments on other issues relevant to 

the conduct of this proposed rulemaking 

that may not specifically be identified in 

this document. 

VIII. Approval of the Office of the 

Secretary 

The Secretary of Energy has approved 

publication of this notice of proposed 

rulemaking and announcement of 

public meeting. 

List of Subjects 

10 CFR Part 429 

Administrative practice and 

procedure, Confidential business 

information, Energy conservation, 

Household appliances, Reporting and 

recordkeeping requirements. 

10 CFR Part 431 

Administrative practice and 

procedure, Confidential business 

information, Energy conservation test 

procedures, and Reporting and 

recordkeeping requirements. 

Signing Authority 

This document of the Department of 

Energy was signed on November 21, 

2023, by Jeffrey Marootian, Principal 

Deputy Assistant Secretary for Energy 

Efficiency and Renewable Energy, 

pursuant to delegated authority from the 

Secretary of Energy. That document 

with the original signature and date is 

maintained by DOE. For administrative 

purposes only, and in compliance with 

requirements of the Office of the Federal 

Register, the undersigned DOE Federal 

Register Liaison Officer has been 

authorized to sign and submit the 

document in electronic format for 

publication, as an official document of 

the Department of Energy. This 

administrative process in no way alters 

the legal effect of this document upon 

publication in the Federal Register. 

Signed in Washington, DC, on November 

29, 2023. 

Treena V. Garrett, 

Federal Register Liaison Officer, U.S. 

Department of Energy. 

For the reasons set forth in the 

preamble, DOE is proposing to amend 

parts 429 and 431 of chapter II, 

subchapter D, of title 10 of the Code of 

Federal Regulations, as set forth below: 

PART 429—CERTIFICATION, 

COMPLIANCE, AND ENFORCEMENT 

FOR CONSUMER PRODUCTS AND 

COMMERCIAL AND INDUSTRIAL 

EQUIPMENT 

■ 1. The authority citation for part 429 

continues to read as follows: 

Authority: 2 U.S.C. 6291–6317; 28 U.S.C. 

2461 note. 

■ 2. Amend § 429.64 by: 

■ a. Revising paragraphs (a)(3) and 

(d)(2); 

■ b. Revising paragraphs (e) 

introductory text and (e)(1)(iii); 

■ c. Redesignating paragraph (e)(1)(iv) 

as paragraph (e)(1)(v); 

■ d. Adding paragraph (e)(1)(iv); and 

■ e. Revising paragraphs (e)(2) 

introductory text and (e)(2)(ii). 

The revisions and addition read as 

follows: 

§ 429.64 Electric motors. 

(a) * * * 

(3) On or after April 17, 2023, 

manufacturers of electric motors that are 

subject to the test procedures in 

appendix B of subpart B of part 431 but 

are not subject to the energy 

conservation standards in subpart B of 

part 431 of this subchapter, must, if they 

chose to voluntarily make 

representations of energy efficiency, 

follow the provisions in paragraph (e) of 

this section. 

* * * * * 

(d) * * * 

(2) Testing was conducted using a 

laboratory other than an accredited 

laboratory that meets the requirements 

of paragraph (f) of this section, or the 

represented value of the electric motor 

basic model was determined through 

the application of an AEDM pursuant to 

the requirements of § 429.70(j), and a 

third-party certification organization 

that is nationally recognized in the 

United States under § 429.73 has 

certified the represented value of the 

electric motor basic model through 

issuance of a certificate of conformity 

for the basic model. 

(e) Determination of represented 

value. Manufacturers of electric motors 

that are subject to energy conservation 

standards in subpart B of part 431 of 

this subchapter, and for which 

minimum values of nominal full-load 

efficiency are prescribed, must 

determine the represented value of 

nominal full-load efficiency (inclusive 

of the inverter for inverter-only electric 

motors) for each basic model of electric 

motor either by testing in conjunction 

with the applicable sampling provisions 

or by applying an AEDM as set forth in 

this section and in § 429.70(j). 

Manufacturers of electric motors that are 

subject to energy conservation standards 

in subpart B of part 431 of this 

subchapter, and for which minimum 

values of average full-load efficiency are 

prescribed, must determine the 

represented value of average full-load 

efficiency (inclusive of the inverter for 

inverter-only electric motors) for each 

basic model of electric motor either by 

testing in conjunction with the 

applicable sampling provisions or by 

applying an AEDM as set forth in this 

section and in § 429.70(j). 

(1) * * * 

(iii) Nominal Full-load Efficiency. 

Manufacturers of electric motors that are 

subject to energy conservation standards 

in subpart B of part 431 of this 

subchapter, and for which minimum 

values of nominal full-load efficiency 

are prescribed, must determine the 

nominal full-load efficiency by selecting 

an efficiency from the ‘‘Nominal Fullload Efficiency’’ table in appendix B 

that is no greater than the average fullload efficiency of the basic model as 

calculated in paragraph (e)(1)(ii) of this 

section. 

(iv) Represented value. For electric 

motors subject to energy conservation 

standards in subpart B of part 431 of 

this subchapter and for which minimum 

values of nominal full-load efficiency 

are prescribed the represented value is 

the nominal full-load efficiency of a 

basic model of electric motor and is to 

be used in marketing materials and all 

public representations, as the certified 

value of efficiency, and on the 

nameplate. (See § 431.31(a) of this 

subchapter.) For electric motors subject 

to energy conservation standards in 

subpart B of part 431 of this subchapter 

and for which minimum values of 

average full-load efficiency are 

prescribed the represented value is the 

average full-load efficiency of a basic 

model of electric motor and is to be 

used in marketing materials and all 

public representations, as the certified 

value of efficiency, and on the 

nameplate. (See § 431.31(a) of this 

subchapter.) 

* * * * * 

(2) Alternative efficiency 

determination methods. In lieu of 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87144 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

testing, the represented value of a basic 

model of electric motor must be 

determined through the application of 

an AEDM pursuant to the requirements 

of § 429.70(j) and the provisions of this 

section, where: 

* * * * * 

(ii) For electric motors subject to 

energy conservation standards in 

subpart B of part 431 of this subchapter 

and for which minimum values of 

nominal full-load efficiency are 

prescribed the represented value is the 

nominal full-load efficiency of a basic 

model of electric motor and is to be 

used in marketing materials and all 

public representations, as the certified 

value of efficiency, and on the 

nameplate. (See § 431.31(a) of this 

subchapter) Determine the nominal fullload efficiency by selecting a value from 

the ‘‘Nominal Full-Load Efficiency’’ 

table in appendix B to subpart B of this 

part, that is no greater than the 

simulated full-load efficiency predicted 

by the AEDM for the basic model. For 

electric motors subject to energy 

conservation standards in subpart B of 

part 431 of this subchapter and for 

which minimum values of average fullload efficiency are prescribed the 

represented value is the average fullload efficiency of a basic model of 

electric motor and is to be used in 

marketing materials and all public 

representations, as the certified value of 

efficiency, and on the nameplate. (See 

§ 431.31(a) of this subchapter.) 

* * * * * 

■ 3. Amend § 429.70 by revising 

paragraph (j)(2)(i)(D) to read as follows: 

§ 429.70 Alternative methods for 

determining energy efficiency and energy 

use. 

* * * * * 

(j) * * * 

(2) * * * 

(i) * * * 

(D) Each basic model must have the 

lowest represented value of nominal 

full-load efficiency or represented value 

of average full-load efficiency, as 

applicable, among the basic models 

within the same equipment class. 

* * * * * 

PART 431—ENERGY EFFICIENCY 

PROGRAM FOR CERTAIN 

COMMERCIAL AND INDUSTRIAL 

EQUIPMENT 

■ 4. The authority citation for part 431 

continues to read as follows: 

Authority: 42 U.S.C. 6291–6317; 28 U.S.C. 

2461 note. 

■ 5. Amend § 431.12 by adding in 

alphabetical order definitions for 

‘‘Capacitor start capacitor run motor’’, 

‘‘Capacitor start induction run motor’’, 

‘‘Permanent split capacitor motor’’, 

‘‘Polyphase motor’’, ‘‘Shaded pole 

motor’’, and ‘‘Split-phase motor’’ to read 

as follows: 

§ 431.12 Definitions. 

* * * * * 

Capacitor start capacitor run motor 

means a single-phase induction electric 

motor equipped with a start capacitor to 

provide the starting torque, as well as a 

run capacitor to maintain a running 

torque while the motor is loaded. 

Capacitor start induction run motor 

means a single-phase induction electric 

motor equipped with a start capacitor to 

provide the starting torque, which is 

capable of operating without a run 

capacitor. 

* * * * * 

Permanent split capacitor motor 

means a single-phase induction electric 

motor that has a capacitor permanently 

connected in series with the starting 

winding of the motor and is 

permanently connected in the circuit 

both at starting and running conditions 

of the motor. 

* * * * * 

Polyphase motor means an electric 

motor that has a stator containing 

multiple distinct windings per motor 

pole, driven by corresponding timeshifted sine waves. 

* * * * * 

Shaded pole motor means a selfstarting single-phase induction electric 

motor with a copper ring shading one of 

the poles. 

* * * * * 

Split-phase motor means a singlephase induction electric motor that 

possesses two windings: a main/running 

winding, and a starting/auxiliary 

winding. 

* * * * * 

■ 6. Revise § 431.25 to read as follows: 

§ 431.25 Energy conservation standards 

and effective dates. 

(a) For purposes of determining the 

required minimum nominal full-load 

efficiency or minimum average full-load 

efficiency of an electric motor that has 

a horsepower or kilowatt rating between 

two horsepower or two kilowatt ratings 

listed in any table of energy 

conservation standards in paragraphs (b) 

through (d) of this section, each such 

electric motor shall be deemed to have 

a listed horsepower or kilowatt rating, 

determined as follows: 

(1) A horsepower at or above the 

midpoint between the two consecutive 

horsepowers shall be rounded up to the 

higher of the two horsepowers; 

(2) A horsepower below the midpoint 

between the two consecutive 

horsepowers shall be rounded down to 

the lower of the two horsepowers; or 

(3) A kilowatt rating shall be directly 

converted from kilowatts to horsepower 

using the formula 1 kilowatt = (1⁄0.746) 

horsepower. The conversion should be 

calculated to three significant decimal 

places, and the resulting horsepower 

shall be rounded in accordance with 

paragraph (a)(1) or (a)(2) of this section, 

whichever applies. 

(b) This section applies to electric 

motors manufactured (alone or as a 

component of another piece of 

equipment) on or after June 1, 2016, but 

before June 1, 2027, that satisfy the 

criteria in paragraph (b)(1)(i) of this 

section, with the exclusion listed in 

paragraph (b)(1)(ii) of this section. 

(1) Scope. (i) The standards in 

paragraph (b)(2) of this section apply 

only to electric motors, including partial 

electric motors, that satisfy the 

following criteria: 

(A) Are single-speed, induction 

motors; 

(B) Are rated for continuous duty (MG 

1) operation or for duty type S1 (IEC); 

(C) Contain a squirrel-cage (MG 1) or 

cage (IEC) rotor; 

(D) Operate on polyphase alternating 

current 60-hertz sinusoidal line power; 

(E) Are rated 600 volts or less; 

(F) Have a 2-, 4-, 6-, or 8-pole 

configuration, 

(G) Are built in a three-digit or fourdigit NEMA frame size (or IEC metric 

equivalent), including those designs 

between two consecutive NEMA frame 

sizes (or IEC metric equivalent), or an 

enclosed 56 NEMA frame size (or IEC 

metric equivalent), 

(H) Produce at least one horsepower 

(0.746 kW) but not greater than 500 

horsepower (373 kW); and 

(I) Meet all of the performance 

requirements of one of the following 

motor types: A NEMA Design A, B, or 

C motor or an IEC Design N, NE, NEY, 

NY or H, HE, HEY, HY motor. 

(ii) The standards in paragraph (b)(2) 

of this section do not apply to the 

following electric motors exempted by 

the Secretary, or any additional electric 

motors that the Secretary may exempt: 

(A) Air-over electric motors; 

(B) Component sets of an electric 

motor; 

(C) Liquid-cooled electric motors; 

(D) Submersible electric motors; and 

(E) Inverter-only electric motors. 

(2) Standards. (i) Each NEMA Design 

A motor, NEMA Design B motor, and 

IEC Design N (including NE, NEY, or 

NY variants) motor that is an electric 

motor meeting the criteria in paragraph 

(b)(1) of this section and with a power 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87145 

rating from 1 horsepower through 500 

horsepower, but excluding fire pump 

electric motors, shall have a nominal 

full-load efficiency of not less than the 

following: 

TABLE 1 TO PARAGRAPH (b)(2)(i)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND IEC 

DESIGN N, NE, NEY OR NY MOTORS (EXCLUDING FIRE PUMP ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 77.0 77.0 85.5 85.5 82.5 82.5 75.5 75.5 

1.5/1.1 .............................................................. 84.0 84.0 86.5 86.5 87.5 86.5 78.5 77.0 

2/1.5 ................................................................. 85.5 85.5 86.5 86.5 88.5 87.5 84.0 86.5 

3/2.2 ................................................................. 86.5 85.5 89.5 89.5 89.5 88.5 85.5 87.5 

5/3.7 ................................................................. 88.5 86.5 89.5 89.5 89.5 89.5 86.5 88.5 

7.5/5.5 .............................................................. 89.5 88.5 91.7 91.0 91.0 90.2 86.5 89.5 

10/7.5 ............................................................... 90.2 89.5 91.7 91.7 91.0 91.7 89.5 90.2 

15/11 ................................................................ 91.0 90.2 92.4 93.0 91.7 91.7 89.5 90.2 

20/15 ................................................................ 91.0 91.0 93.0 93.0 91.7 92.4 90.2 91.0 

25/18.5 ............................................................. 91.7 91.7 93.6 93.6 93.0 93.0 90.2 91.0 

30/22 ................................................................ 91.7 91.7 93.6 94.1 93.0 93.6 91.7 91.7 

40/30 ................................................................ 92.4 92.4 94.1 94.1 94.1 94.1 91.7 91.7 

50/37 ................................................................ 93.0 93.0 94.5 94.5 94.1 94.1 92.4 92.4 

60/45 ................................................................ 93.6 93.6 95.0 95.0 94.5 94.5 92.4 93.0 

75/55 ................................................................ 93.6 93.6 95.4 95.0 94.5 94.5 93.6 94.1 

100/75 .............................................................. 94.1 93.6 95.4 95.4 95.0 95.0 93.6 94.1 

125/90 .............................................................. 95.0 94.1 95.4 95.4 95.0 95.0 94.1 94.1 

150/110 ............................................................ 95.0 94.1 95.8 95.8 95.8 95.4 94.1 94.1 

200/150 ............................................................ 95.4 95.0 96.2 95.8 95.8 95.4 94.5 94.1 

250/186 ............................................................ 95.8 95.0 96.2 95.8 95.8 95.8 95.0 95.0 

300/224 ............................................................ 95.8 95.4 96.2 95.8 95.8 95.8 ................ ................

350/261 ............................................................ 95.8 95.4 96.2 95.8 95.8 95.8 ................ ................

400/298 ............................................................ 95.8 95.8 96.2 95.8 ................ ................ ................ ................

450/336 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

500/373 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

(ii) Each NEMA Design C motor and 

IEC Design H (including HE, HEY, or 

HY variants) electric motor meeting the 

criteria in paragraph (b)(1) of this 

section and with a power rating from 1 

horsepower through 200 horsepower, 

shall have a nominal full-load efficiency 

that is not less than the following: 

TABLE 2 TO PARAGRAPH (b)(2)(ii)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN C AND IEC DESIGN H, HE, 

HEY OR HY MOTORS AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open 

1/.75 ......................................................................................................... 85.5 85.5 82.5 82.5 75.5 75.5 

1.5/1.1 ...................................................................................................... 86.5 86.5 87.5 86.5 78.5 77.0 

2/1.5 ......................................................................................................... 86.5 86.5 88.5 87.5 84.0 86.5 

3/2.2 ......................................................................................................... 89.5 89.5 89.5 88.5 85.5 87.5 

5/3.7 ......................................................................................................... 89.5 89.5 89.5 89.5 86.5 88.5 

7.5/5.5 ...................................................................................................... 91.7 91.0 91.0 90.2 86.5 89.5 

10/7.5 ....................................................................................................... 91.7 91.7 91.0 91.7 89.5 90.2 

15/11 ........................................................................................................ 92.4 93.0 91.7 91.7 89.5 90.2 

20/15 ........................................................................................................ 93.0 93.0 91.7 92.4 90.2 91.0 

25/18.5 ..................................................................................................... 93.6 93.6 93.0 93.0 90.2 91.0 

30/22 ........................................................................................................ 93.6 94.1 93.0 93.6 91.7 91.7 

40/30 ........................................................................................................ 94.1 94.1 94.1 94.1 91.7 91.7 

50/37 ........................................................................................................ 94.5 94.5 94.1 94.1 92.4 92.4 

60/45 ........................................................................................................ 95.0 95.0 94.5 94.5 92.4 93.0 

75/55 ........................................................................................................ 95.4 95.0 94.5 94.5 93.6 94.1 

100/75 ...................................................................................................... 95.4 95.4 95.0 95.0 93.6 94.1 

125/90 ...................................................................................................... 95.4 95.4 95.0 95.0 94.1 94.1 

150/110 .................................................................................................... 95.8 95.8 95.8 95.4 94.1 94.1 

200/150 .................................................................................................... 96.2 95.8 95.8 95.4 94.5 94.1 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87146 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

(iii) Each fire pump electric motor 

meeting the criteria in paragraph (b)(1) 

of this section and with a power rating 

of 1 horsepower through 500 

horsepower, shall have a nominal fullload efficiency that is not less than the following: 

TABLE 3 TO PARAGRAPH (b)(2)(iii)—NOMINAL FULL-LOAD EFFICIENCIES OF FIRE PUMP ELECTRIC MOTORS AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 75.5 ................ 82.5 82.5 80.0 80.0 74.0 74.0 

1.5/1.1 .............................................................. 82.5 82.5 84.0 84.0 85.5 84.0 77.0 75.5 

2/1.5 ................................................................. 84.0 84.0 84.0 84.0 86.5 85.5 82.5 85.5 

3/2.2 ................................................................. 85.5 84.0 87.5 86.5 87.5 86.5 84.0 86.5 

5/3.7 ................................................................. 87.5 85.5 87.5 87.5 87.5 87.5 85.5 87.5 

7.5/5.5 .............................................................. 88.5 87.5 89.5 88.5 89.5 88.5 85.5 88.5 

10/7.5 ............................................................... 89.5 88.5 89.5 89.5 89.5 90.2 88.5 89.5 

15/11 ................................................................ 90.2 89.5 91.0 91.0 90.2 90.2 88.5 89.5 

20/15 ................................................................ 90.2 90.2 91.0 91.0 90.2 91.0 89.5 90.2 

25/18.5 ............................................................. 91.0 91.0 92.4 91.7 91.7 91.7 89.5 90.2 

30/22 ................................................................ 91.0 91.0 92.4 92.4 91.7 92.4 91.0 91.0 

40/30 ................................................................ 91.7 91.7 93.0 93.0 93.0 93.0 91.0 91.0 

50/37 ................................................................ 92.4 92.4 93.0 93.0 93.0 93.0 91.7 91.7 

60/45 ................................................................ 93.0 93.0 93.6 93.6 93.6 93.6 91.7 92.4 

75/55 ................................................................ 93.0 93.0 94.1 94.1 93.6 93.6 93.0 93.6 

100/75 .............................................................. 93.6 93.0 94.5 94.1 94.1 94.1 93.0 93.6 

125/90 .............................................................. 94.5 93.6 94.5 94.5 94.1 94.1 93.6 93.6 

150/110 ............................................................ 94.5 93.6 95.0 95.0 95.0 94.5 93.6 93.6 

200/150 ............................................................ 95.0 94.5 95.0 95.0 95.0 94.5 94.1 93.6 

250/186 ............................................................ 95.4 94.5 95.0 95.4 95.0 95.4 94.5 94.5 

300/224 ............................................................ 95.4 95.0 95.4 95.4 95.0 95.4 ................ ................

350/261 ............................................................ 95.4 95.0 95.4 95.4 95.0 95.4 ................ ................

400/298 ............................................................ 95.4 95.4 95.4 95.4 ................ ................ ................ ................

450/336 ............................................................ 95.4 95.8 95.4 95.8 ................ ................ ................ ................

500/373 ............................................................ 95.4 95.8 95.8 95.8 ................ ................ ................ ................

(c) This section applies to electric 

motors manufactured (alone or as a 

component of another piece of 

equipment) on or after June 1, 2027, but 

before January 1, 2029, that satisfy the 

criteria in paragraph (c)(1)(i) of this 

section, with the exclusion listed in 

paragraph (c)(1)(ii) of this section. 

(1) Scope. (i) The standards in 

paragraph (c)(2) of this section apply 

only to electric motors, including partial 

electric motors, that satisfy the 

following criteria: 

(A) Are single-speed, induction 

motors; 

(B) Are rated for continuous duty (MG 

1) operation or for duty type S1 (IEC); 

(C) Contain a squirrel-cage (MG 1) or 

cage (IEC) rotor; 

(D) Operate on polyphase alternating 

current 60-hertz sinusoidal line power; 

(E) Are rated 600 volts or less; 

(F) Have a 2-, 4-, 6-, or 8-pole 

configuration, 

(G) Are built in a three-digit or fourdigit NEMA frame size (or IEC metric 

equivalent), including those designs 

between two consecutive NEMA frame 

sizes (or IEC metric equivalent), or an 

enclosed 56 NEMA frame size (or IEC 

metric equivalent), or have an air-over 

enclosure and a specialized frame size, 

(H) Produce at least one horsepower 

(0.746 kW) but not greater than 750 

horsepower (559 kW); and 

(I) Meet all of the performance 

requirements of one of the following 

motor types: A NEMA Design A, B, or 

C motor or an IEC Design N, NE, NEY, 

NY or H, HE, HEY, HY motor. 

(ii) The standards in paragraph (c)(2) 

of this section do not apply to the 

following electric motors exempted by 

the Secretary, or any additional electric 

motors that the Secretary may exempt: 

(A) Component sets of an electric 

motor; 

(B) Liquid-cooled electric motors; 

(C) Submersible electric motors; and 

(D) Inverter-only electric motors. 

(2) Standards. (i) Each NEMA Design 

A motor, NEMA Design B motor, and 

IEC Design N (including NE, NEY, or 

NY variants) motor that is an electric 

motor meeting the criteria in paragraph 

(c)(1) of this section but excluding fire 

pump electric motors and air-over 

electric motors, and with a power rating 

from 1 horsepower through 750 

horsepower, shall have a nominal fullload efficiency of not less than the 

following: 

TABLE 4 TO PARAGRAPH (c)(2)(i)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND IEC 

DESIGN N, NE, NEY OR NY MOTORS (EXCLUDING FIRE PUMP ELECTRIC MOTORS AND AIR-OVER ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 77.0 77.0 85.5 85.5 82.5 82.5 75.5 75.5 

1.5/1.1 .............................................................. 84.0 84.0 86.5 86.5 87.5 86.5 78.5 77.0 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87147 

TABLE 4 TO PARAGRAPH (c)(2)(i)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND IEC 

DESIGN N, NE, NEY OR NY MOTORS (EXCLUDING FIRE PUMP ELECTRIC MOTORS AND AIR-OVER ELECTRIC MOTORS) AT 60 Hz—Continued 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

2/1.5 ................................................................. 85.5 85.5 86.5 86.5 88.5 87.5 84.0 86.5 

3/2.2 ................................................................. 86.5 85.5 89.5 89.5 89.5 88.5 85.5 87.5 

5/3.7 ................................................................. 88.5 86.5 89.5 89.5 89.5 89.5 86.5 88.5 

7.5/5.5 .............................................................. 89.5 88.5 91.7 91.0 91.0 90.2 86.5 89.5 

10/7.5 ............................................................... 90.2 89.5 91.7 91.7 91.0 91.7 89.5 90.2 

15/11 ................................................................ 91.0 90.2 92.4 93.0 91.7 91.7 89.5 90.2 

20/15 ................................................................ 91.0 91.0 93.0 93.0 91.7 92.4 90.2 91.0 

25/18.5 ............................................................. 91.7 91.7 93.6 93.6 93.0 93.0 90.2 91.0 

30/22 ................................................................ 91.7 91.7 93.6 94.1 93.0 93.6 91.7 91.7 

40/30 ................................................................ 92.4 92.4 94.1 94.1 94.1 94.1 91.7 91.7 

50/37 ................................................................ 93.0 93.0 94.5 94.5 94.1 94.1 92.4 92.4 

60/45 ................................................................ 93.6 93.6 95.0 95.0 94.5 94.5 92.4 93.0 

75/55 ................................................................ 93.6 93.6 95.4 95.0 94.5 94.5 93.6 94.1 

100/75 .............................................................. 95.0 94.5 96.2 96.2 95.8 95.8 94.5 95.0 

125/90 .............................................................. 95.4 94.5 96.2 96.2 95.8 95.8 95.0 95.0 

150/110 ............................................................ 95.4 94.5 96.2 96.2 96.2 95.8 95.0 95.0 

200/150 ............................................................ 95.8 95.4 96.5 96.2 96.2 95.8 95.4 95.0 

250/186 ............................................................ 96.2 95.4 96.5 96.2 96.2 96.2 95.4 95.4 

300/224 ............................................................ 95.8 95.4 96.2 95.8 95.8 95.8 ................ ................

350/261 ............................................................ 95.8 95.4 96.2 95.8 95.8 95.8 ................ ................

400/298 ............................................................ 95.8 95.8 96.2 95.8 ................ ................ ................ ................

450/336 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

500/373 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

550/410 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

600/447 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

650/485 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

700/522 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

750/559 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

(ii) Each NEMA Design A motor, 

NEMA Design B motor, and IEC Design 

N (including NE, NEY, or NY variants) 

motor that is an air-over electric motor 

meeting the criteria in paragraph (c)(1) 

of this section, but excluding fire pump 

electric motors, and with a power rating 

from 1 horsepower through 250 

horsepower, built in a standard frame 

size, shall have a nominal full-load 

efficiency of not less than the following: 

TABLE 5 TO PARAGRAPH (c)(2)(ii)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND IEC 

DESIGN N, NE, NEY OR NY STANDARD FRAME SIZE AIR-OVER ELECTRIC MOTORS (EXCLUDING FIRE PUMP ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 77.0 77.0 85.5 85.5 82.5 82.5 75.5 75.5 

1.5/1.1 .............................................................. 84.0 84.0 86.5 86.5 87.5 86.5 78.5 77.0 

2/1.5 ................................................................. 85.5 85.5 86.5 86.5 88.5 87.5 84.0 86.5 

3/2.2 ................................................................. 86.5 85.5 89.5 89.5 89.5 88.5 85.5 87.5 

5/3.7 ................................................................. 88.5 86.5 89.5 89.5 89.5 89.5 86.5 88.5 

7.5/5.5 .............................................................. 89.5 88.5 91.7 91.0 91.0 90.2 86.5 89.5 

10/7.5 ............................................................... 90.2 89.5 91.7 91.7 91.0 91.7 89.5 90.2 

15/11 ................................................................ 91.0 90.2 92.4 93.0 91.7 91.7 89.5 90.2 

20/15 ................................................................ 91.0 91.0 93.0 93.0 91.7 92.4 90.2 91.0 

25/18.5 ............................................................. 91.7 91.7 93.6 93.6 93.0 93.0 90.2 91.0 

30/22 ................................................................ 91.7 91.7 93.6 94.1 93.0 93.6 91.7 91.7 

40/30 ................................................................ 92.4 92.4 94.1 94.1 94.1 94.1 91.7 91.7 

50/37 ................................................................ 93.0 93.0 94.5 94.5 94.1 94.1 92.4 92.4 

60/45 ................................................................ 93.6 93.6 95.0 95.0 94.5 94.5 92.4 93.0 

75/55 ................................................................ 93.6 93.6 95.4 95.0 94.5 94.5 93.6 94.1 

100/75 .............................................................. 95.0 94.5 96.2 96.2 95.8 95.8 94.5 95.0 

125/90 .............................................................. 95.4 94.5 96.2 96.2 95.8 95.8 95.0 95.0 

150/110 ............................................................ 95.4 94.5 96.2 96.2 96.2 95.8 95.0 95.0 

200/150 ............................................................ 95.8 95.4 96.5 96.2 96.2 95.8 95.4 95.0 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87148 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE 5 TO PARAGRAPH (c)(2)(ii)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND IEC 

DESIGN N, NE, NEY OR NY STANDARD FRAME SIZE AIR-OVER ELECTRIC MOTORS (EXCLUDING FIRE PUMP ELECTRIC MOTORS) AT 60 Hz—Continued 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

250/186 ............................................................ 96.2 95.4 96.5 96.2 96.2 96.2 95.4 95.4 

(iii) Each NEMA Design A motor, 

NEMA Design B motor, and IEC Design 

N (including NE, NEY, or NY variants) 

motor that is an air-over electric motor 

meeting the criteria in paragraph (c)(1) 

of this section, but excluding fire pump 

electric motors, and with a power rating 

from 1 horsepower through 20 

horsepower, built in a specialized frame 

size, shall have a nominal full-load 

efficiency of not less than the following: 

TABLE 6 TO PARAGRAPH (c)(2)(iii)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND IEC 

DESIGN N, NE, NEY OR NY SPECIALIZED FRAME SIZE AIR-OVER ELECTRIC MOTORS (EXCLUDING FIRE PUMP ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 74.0 ................ 82.5 82.5 80.0 80.0 74.0 74.0 

1.5/1.1 .............................................................. 82.5 82.5 84.0 84.0 85.5 84.0 77.0 75.5 

2/1.5 ................................................................. 84.0 84.0 84.0 84.0 86.5 85.5 82.5 85.5 

3/2.2 ................................................................. 85.5 84.0 87.5 86.5 87.5 86.5 84.0 86.5 

5/3.7 ................................................................. 87.5 85.5 87.5 87.5 87.5 87.5 85.5 87.5 

7.5/5.5 .............................................................. 88.5 87.5 89.5 88.5 89.5 88.5 85.5 88.5 

10/7.5 ............................................................... 89.5 88.5 89.5 89.5 89.5 90.2 ................ ................

15/11 ................................................................ 90.2 89.5 91.0 91.0 ................ ................ ................ ................

20/15 ................................................................ 90.2 90.2 91.0 91.0 ................ ................ ................ ................

(iv) Each NEMA Design C motor and 

IEC Design H (including HE, HEY, or 

HY variants) electric motor meeting the 

criteria in paragraph (c)(1) of this 

section but excluding air-over electric 

motors and with a power rating from 1 

horsepower through 200 horsepower, 

shall have a nominal full-load efficiency 

that is not less than the following: 

TABLE 7 TO PARAGRAPH (c)(2)(iv)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN C AND IEC DESIGN H, HE, 

HEY OR HY MOTORS (EXCLUDING AIR-OVER ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open 

1/.75 ......................................................................................................... 85.5 85.5 82.5 82.5 75.5 75.5 

1.5/1.1 ...................................................................................................... 86.5 86.5 87.5 86.5 78.5 77.0 

2/1.5 ......................................................................................................... 86.5 86.5 88.5 87.5 84.0 86.5 

3/2.2 ......................................................................................................... 89.5 89.5 89.5 88.5 85.5 87.5 

5/3.7 ......................................................................................................... 89.5 89.5 89.5 89.5 86.5 88.5 

7.5/5.5 ...................................................................................................... 91.7 91.0 91.0 90.2 86.5 89.5 

10/7.5 ....................................................................................................... 91.7 91.7 91.0 91.7 89.5 90.2 

15/11 ........................................................................................................ 92.4 93.0 91.7 91.7 89.5 90.2 

20/15 ........................................................................................................ 93.0 93.0 91.7 92.4 90.2 91.0 

25/18.5 ..................................................................................................... 93.6 93.6 93.0 93.0 90.2 91.0 

30/22 ........................................................................................................ 93.6 94.1 93.0 93.6 91.7 91.7 

40/30 ........................................................................................................ 94.1 94.1 94.1 94.1 91.7 91.7 

50/37 ........................................................................................................ 94.5 94.5 94.1 94.1 92.4 92.4 

60/45 ........................................................................................................ 95.0 95.0 94.5 94.5 92.4 93.0 

75/55 ........................................................................................................ 95.4 95.0 94.5 94.5 93.6 94.1 

100/75 ...................................................................................................... 95.4 95.4 95.0 95.0 93.6 94.1 

125/90 ...................................................................................................... 95.4 95.4 95.0 95.0 94.1 94.1 

150/110 .................................................................................................... 95.8 95.8 95.8 95.4 94.1 94.1 

200/150 .................................................................................................... 96.2 95.8 95.8 95.4 94.5 94.1 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87149 

(v) Each fire pump electric motor 

meeting the criteria in paragraph (c)(1) 

of this section, but excluding air-over 

electric motors, and with a power rating 

of 1 horsepower through 500 

horsepower, shall have a nominal fullload efficiency that is not less than the 

following: 

TABLE 8 TO PARAGRAPH (c)(2)(v)—NOMINAL FULL-LOAD EFFICIENCIES OF FIRE PUMP ELECTRIC MOTORS (EXCLUDING

AIR-OVER ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 75.5 ................ 82.5 82.5 80.0 80.0 74.0 74.0 

1.5/1.1 .............................................................. 82.5 82.5 84.0 84.0 85.5 84.0 77.0 75.5 

2/1.5 ................................................................. 84.0 84.0 84.0 84.0 86.5 85.5 82.5 85.5 

3/2.2 ................................................................. 85.5 84.0 87.5 86.5 87.5 86.5 84.0 86.5 

5/3.7 ................................................................. 87.5 85.5 87.5 87.5 87.5 87.5 85.5 87.5 

7.5/5.5 .............................................................. 88.5 87.5 89.5 88.5 89.5 88.5 85.5 88.5 

10/7.5 ............................................................... 89.5 88.5 89.5 89.5 89.5 90.2 88.5 89.5 

15/11 ................................................................ 90.2 89.5 91.0 91.0 90.2 90.2 88.5 89.5 

20/15 ................................................................ 90.2 90.2 91.0 91.0 90.2 91.0 89.5 90.2 

25/18.5 ............................................................. 91.0 91.0 92.4 91.7 91.7 91.7 89.5 90.2 

30/22 ................................................................ 91.0 91.0 92.4 92.4 91.7 92.4 91.0 91.0 

40/30 ................................................................ 91.7 91.7 93.0 93.0 93.0 93.0 91.0 91.0 

50/37 ................................................................ 92.4 92.4 93.0 93.0 93.0 93.0 91.7 91.7 

60/45 ................................................................ 93.0 93.0 93.6 93.6 93.6 93.6 91.7 92.4 

75/55 ................................................................ 93.0 93.0 94.1 94.1 93.6 93.6 93.0 93.6 

100/75 .............................................................. 93.6 93.0 94.5 94.1 94.1 94.1 93.0 93.6 

125/90 .............................................................. 94.5 93.6 94.5 94.5 94.1 94.1 93.6 93.6 

150/110 ............................................................ 94.5 93.6 95.0 95.0 95.0 94.5 93.6 93.6 

200/150 ............................................................ 95.0 94.5 95.0 95.0 95.0 94.5 94.1 93.6 

250/186 ............................................................ 95.4 94.5 95.0 95.4 95.0 95.4 94.5 94.5 

300/224 ............................................................ 95.4 95.0 95.4 95.4 95.0 95.4 ................ ................

350/261 ............................................................ 95.4 95.0 95.4 95.4 95.0 95.4 ................ ................

400/298 ............................................................ 95.4 95.4 95.4 95.4 ................ ................ ................ ................

450/336 ............................................................ 95.4 95.8 95.4 95.8 ................ ................ ................ ................

500/373 ............................................................ 95.4 95.8 95.8 95.8 ................ ................ ................ ................

(d) This section applies to electric 

motors manufactured (alone or as a 

component of another piece of 

equipment) on or after January 1, 2029. 

(1) The standards in paragraph 

(d)(1)(ii) of this section apply only to 

electric motors that satisfy the criteria in 

paragraph (d)(1)(i)(A) of this section and 

with the exclusion listed in paragraph 

(d)(1)(i)(B) of this section. 

(i) Scope. (A) The standards in 

paragraph (d)(1)(ii) of this section apply 

only to electric motors, including partial 

electric motors, that satisfy the 

following criteria: 

(1) Are single-speed, induction 

motors; 

(2) Are rated for continuous duty (MG 

1) operation or for duty type S1 (IEC); 

(3) Contain a squirrel-cage (MG 1) or 

cage (IEC) rotor; 

(4) Operate on polyphase alternating 

current 60-hertz sinusoidal line power; 

(5) Are rated 600 volts or less; 

(6) Have a 2-, 4-, 6-, or 8-pole 

configuration, 

(7) Are built in a three-digit or fourdigit NEMA frame size (or IEC metric 

equivalent), including those designs 

between two consecutive NEMA frame 

sizes (or IEC metric equivalent), or an 

enclosed 56 NEMA frame size (or IEC 

metric equivalent), or have an air-over 

enclosure and a specialized frame size, 

(8) Produce at least one horsepower 

(0.746 kW) but not greater than 750 

horsepower (559 kW); and 

(9) Meet all of the performance 

requirements of one of the following 

motor types: A NEMA Design A, B, or 

C motor or an IEC Design N, NE, NEY, 

NY or H, HE, HEY, HY motor. 

(B) The standards in paragraph 

(d)(1)(ii) of this section do not apply to 

the following electric motors exempted 

by the Secretary, or any additional 

electric motors that the Secretary may 

exempt: 

(1) Component sets of an electric 

motor; 

(2) Liquid-cooled electric motors; 

(3) Submersible electric motors; and 

(4) Inverter-only electric motors. 

(ii) Standards. (A) Each NEMA Design 

A motor, NEMA Design B motor, and 

IEC Design N (including NE, NEY, or 

NY variants) motor that is an electric 

motor meeting the criteria in paragraph 

(d)(1)(i) of this section but excluding fire 

pump electric motors and air-over 

electric motors, and with a power rating 

from 1 horsepower through 750 

horsepower, shall have a nominal fullload efficiency of not less than the 

following: 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87150 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

TABLE 9 TO PARAGRAPH (d)(1)(ii)(A)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND

IEC DESIGN N, NE, NEY OR NY MOTORS (EXCLUDING FIRE PUMP ELECTRIC MOTORS AND AIR-OVER ELECTRIC

MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 77.0 77.0 85.5 85.5 82.5 82.5 75.5 75.5 

1.5/1.1 .............................................................. 84.0 84.0 86.5 86.5 87.5 86.5 78.5 77.0 

2/1.5 ................................................................. 85.5 85.5 86.5 86.5 88.5 87.5 84.0 86.5 

3/2.2 ................................................................. 86.5 85.5 89.5 89.5 89.5 88.5 85.5 87.5 

5/3.7 ................................................................. 88.5 86.5 89.5 89.5 89.5 89.5 86.5 88.5 

7.5/5.5 .............................................................. 89.5 88.5 91.7 91.0 91.0 90.2 86.5 89.5 

10/7.5 ............................................................... 90.2 89.5 91.7 91.7 91.0 91.7 89.5 90.2 

15/11 ................................................................ 91.0 90.2 92.4 93.0 91.7 91.7 89.5 90.2 

20/15 ................................................................ 91.0 91.0 93.0 93.0 91.7 92.4 90.2 91.0 

25/18.5 ............................................................. 91.7 91.7 93.6 93.6 93.0 93.0 90.2 91.0 

30/22 ................................................................ 91.7 91.7 93.6 94.1 93.0 93.6 91.7 91.7 

40/30 ................................................................ 92.4 92.4 94.1 94.1 94.1 94.1 91.7 91.7 

50/37 ................................................................ 93.0 93.0 94.5 94.5 94.1 94.1 92.4 92.4 

60/45 ................................................................ 93.6 93.6 95.0 95.0 94.5 94.5 92.4 93.0 

75/55 ................................................................ 93.6 93.6 95.4 95.0 94.5 94.5 93.6 94.1 

100/75 .............................................................. 95.0 94.5 96.2 96.2 95.8 95.8 94.5 95.0 

125/90 .............................................................. 95.4 94.5 96.2 96.2 95.8 95.8 95.0 95.0 

150/110 ............................................................ 95.4 94.5 96.2 96.2 96.2 95.8 95.0 95.0 

200/150 ............................................................ 95.8 95.4 96.5 96.2 96.2 95.8 95.4 95.0 

250/186 ............................................................ 96.2 95.4 96.5 96.2 96.2 96.2 95.4 95.4 

300/224 ............................................................ 95.8 95.4 96.2 95.8 95.8 95.8 ................ ................

350/261 ............................................................ 95.8 95.4 96.2 95.8 95.8 95.8 ................ ................

400/298 ............................................................ 95.8 95.8 96.2 95.8 ................ ................ ................ ................

450/336 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

500/373 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

550/410 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

600/447 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

650/485 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

700/522 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

750/559 ............................................................ 95.8 96.2 96.2 96.2 ................ ................ ................ ................

(B) Each NEMA Design A motor, 

NEMA Design B motor, and IEC Design 

N (including NE, NEY, or NY variants) 

motor that is an air-over electric motor 

meeting the criteria in paragraph 

(d)(1)(i) of this section, but excluding 

fire pump electric motors, and with a 

power rating from 1 horsepower through 

250 horsepower, built in a standard 

frame size, shall have a nominal fullload efficiency of not less than the 

following: 

TABLE 10 TO PARAGRAPH (d)(1)(ii)(B)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND

IEC DESIGN N, NE, NEY OR NY STANDARD FRAME SIZE AIR-OVER ELECTRIC MOTORS (EXCLUDING FIRE PUMP

ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 77.0 77.0 85.5 85.5 82.5 82.5 75.5 75.5 

1.5/1.1 .............................................................. 84.0 84.0 86.5 86.5 87.5 86.5 78.5 77.0 

2/1.5 ................................................................. 85.5 85.5 86.5 86.5 88.5 87.5 84.0 86.5 

3/2.2 ................................................................. 86.5 85.5 89.5 89.5 89.5 88.5 85.5 87.5 

5/3.7 ................................................................. 88.5 86.5 89.5 89.5 89.5 89.5 86.5 88.5 

7.5/5.5 .............................................................. 89.5 88.5 91.7 91.0 91.0 90.2 86.5 89.5 

10/7.5 ............................................................... 90.2 89.5 91.7 91.7 91.0 91.7 89.5 90.2 

15/11 ................................................................ 91.0 90.2 92.4 93.0 91.7 91.7 89.5 90.2 

20/15 ................................................................ 91.0 91.0 93.0 93.0 91.7 92.4 90.2 91.0 

25/18.5 ............................................................. 91.7 91.7 93.6 93.6 93.0 93.0 90.2 91.0 

30/22 ................................................................ 91.7 91.7 93.6 94.1 93.0 93.6 91.7 91.7 

40/30 ................................................................ 92.4 92.4 94.1 94.1 94.1 94.1 91.7 91.7 

50/37 ................................................................ 93.0 93.0 94.5 94.5 94.1 94.1 92.4 92.4 

60/45 ................................................................ 93.6 93.6 95.0 95.0 94.5 94.5 92.4 93.0 

75/55 ................................................................ 93.6 93.6 95.4 95.0 94.5 94.5 93.6 94.1 

100/75 .............................................................. 95.0 94.5 96.2 96.2 95.8 95.8 94.5 95.0 

125/90 .............................................................. 95.4 94.5 96.2 96.2 95.8 95.8 95.0 95.0 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87151 

TABLE 10 TO PARAGRAPH (d)(1)(ii)(B)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND

IEC DESIGN N, NE, NEY OR NY STANDARD FRAME SIZE AIR-OVER ELECTRIC MOTORS (EXCLUDING FIRE PUMP

ELECTRIC MOTORS) AT 60 Hz—Continued 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

150/110 ............................................................ 95.4 94.5 96.2 96.2 96.2 95.8 95.0 95.0 

200/150 ............................................................ 95.8 95.4 96.5 96.2 96.2 95.8 95.4 95.0 

250/186 ............................................................ 96.2 95.4 96.5 96.2 96.2 96.2 95.4 95.4 

(C) Each NEMA Design A motor, 

NEMA Design B motor, and IEC Design 

N (including NE, NEY, or NY variants) 

motor that is an air-over electric motor 

meeting the criteria in paragraph 

(d)(1)(i) of this section, but excluding 

fire pump electric motors, and with a 

power rating from 1 horsepower through 

20 horsepower, built in a specialized 

frame size, shall have a nominal fullload efficiency of not less than the 

following: 

TABLE 11 TO PARAGRAPH (d)(1)(ii)(C)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN A, NEMA DESIGN B AND

IEC DESIGN N, NE, NEY OR NY SPECIALIZED FRAME SIZE AIR-OVER ELECTRIC MOTORS (EXCLUDING FIRE PUMP

ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 74.0 ................ 82.5 82.5 80.0 80.0 74.0 74.0 

1.5/1.1 .............................................................. 82.5 82.5 84.0 84.0 85.5 84.0 77.0 75.5 

2/1.5 ................................................................. 84.0 84.0 84.0 84.0 86.5 85.5 82.5 85.5 

3/2.2 ................................................................. 85.5 84.0 87.5 86.5 87.5 86.5 84.0 86.5 

5/3.7 ................................................................. 87.5 85.5 87.5 87.5 87.5 87.5 85.5 87.5 

7.5/5.5 .............................................................. 88.5 87.5 89.5 88.5 89.5 88.5 85.5 88.5 

10/7.5 ............................................................... 89.5 88.5 89.5 89.5 89.5 90.2 ................ ................

15/11 ................................................................ 90.2 89.5 91.0 91.0 ................ ................ ................ ................

20/15 ................................................................ 90.2 90.2 91.0 91.0 ................ ................ ................ ................

(D) Each NEMA Design C motor and 

IEC Design H (including HE, HEY, or 

HY variants) electric motor meeting the 

criteria in paragraph (d)(1)(i) of this 

section but excluding air-over electric 

motors and with a power rating from 1 

horsepower through 200 horsepower, 

shall have a nominal full-load efficiency 

that is not less than the following: 

TABLE 12 TO PARAGRAPH (d)(1)(ii)(D)—NOMINAL FULL-LOAD EFFICIENCIES OF NEMA DESIGN C AND IEC DESIGN H, 

HE, HEY OR HY MOTORS (EXCLUDING AIR-OVER ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open 

1/.75 ......................................................................................................... 85.5 85.5 82.5 82.5 75.5 75.5 

1.5/1.1 ...................................................................................................... 86.5 86.5 87.5 86.5 78.5 77.0 

2/1.5 ......................................................................................................... 86.5 86.5 88.5 87.5 84.0 86.5 

3/2.2 ......................................................................................................... 89.5 89.5 89.5 88.5 85.5 87.5 

5/3.7 ......................................................................................................... 89.5 89.5 89.5 89.5 86.5 88.5 

7.5/5.5 ...................................................................................................... 91.7 91.0 91.0 90.2 86.5 89.5 

10/7.5 ....................................................................................................... 91.7 91.7 91.0 91.7 89.5 90.2 

15/11 ........................................................................................................ 92.4 93.0 91.7 91.7 89.5 90.2 

20/15 ........................................................................................................ 93.0 93.0 91.7 92.4 90.2 91.0 

25/18.5 ..................................................................................................... 93.6 93.6 93.0 93.0 90.2 91.0 

30/22 ........................................................................................................ 93.6 94.1 93.0 93.6 91.7 91.7 

40/30 ........................................................................................................ 94.1 94.1 94.1 94.1 91.7 91.7 

50/37 ........................................................................................................ 94.5 94.5 94.1 94.1 92.4 92.4 

60/45 ........................................................................................................ 95.0 95.0 94.5 94.5 92.4 93.0 

75/55 ........................................................................................................ 95.4 95.0 94.5 94.5 93.6 94.1 

100/75 ...................................................................................................... 95.4 95.4 95.0 95.0 93.6 94.1 

125/90 ...................................................................................................... 95.4 95.4 95.0 95.0 94.1 94.1 

150/110 .................................................................................................... 95.8 95.8 95.8 95.4 94.1 94.1 

200/150 .................................................................................................... 96.2 95.8 95.8 95.4 94.5 94.1 


ddrumheller on DSK120RN23PROD with PROPOSALS2
87152 Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 

(E) Each fire pump electric motor 

meeting the criteria in paragraph 

(d)(1)(i) of this section, but excluding 

air-over electric motors, and with a 

power rating of 1 horsepower through 

500 horsepower, shall have a nominal 

full-load efficiency that is not less than 

the following: 

TABLE 13 TO PARAGRAPH (d)(1)(ii)(E)—NOMINAL FULL-LOAD EFFICIENCIES OF FIRE PUMP ELECTRIC MOTORS

(EXCLUDING AIR-OVER ELECTRIC MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Nominal full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

1/.75 ................................................................. 75.5 ................ 82.5 82.5 80.0 80.0 74.0 74.0 

1.5/1.1 .............................................................. 82.5 82.5 84.0 84.0 85.5 84.0 77.0 75.5 

2/1.5 ................................................................. 84.0 84.0 84.0 84.0 86.5 85.5 82.5 85.5 

3/2.2 ................................................................. 85.5 84.0 87.5 86.5 87.5 86.5 84.0 86.5 

5/3.7 ................................................................. 87.5 85.5 87.5 87.5 87.5 87.5 85.5 87.5 

7.5/5.5 .............................................................. 88.5 87.5 89.5 88.5 89.5 88.5 85.5 88.5 

10/7.5 ............................................................... 89.5 88.5 89.5 89.5 89.5 90.2 88.5 89.5 

15/11 ................................................................ 90.2 89.5 91.0 91.0 90.2 90.2 88.5 89.5 

20/15 ................................................................ 90.2 90.2 91.0 91.0 90.2 91.0 89.5 90.2 

25/18.5 ............................................................. 91.0 91.0 92.4 91.7 91.7 91.7 89.5 90.2 

30/22 ................................................................ 91.0 91.0 92.4 92.4 91.7 92.4 91.0 91.0 

40/30 ................................................................ 91.7 91.7 93.0 93.0 93.0 93.0 91.0 91.0 

50/37 ................................................................ 92.4 92.4 93.0 93.0 93.0 93.0 91.7 91.7 

60/45 ................................................................ 93.0 93.0 93.6 93.6 93.6 93.6 91.7 92.4 

75/55 ................................................................ 93.0 93.0 94.1 94.1 93.6 93.6 93.0 93.6 

100/75 .............................................................. 93.6 93.0 94.5 94.1 94.1 94.1 93.0 93.6 

125/90 .............................................................. 94.5 93.6 94.5 94.5 94.1 94.1 93.6 93.6 

150/110 ............................................................ 94.5 93.6 95.0 95.0 95.0 94.5 93.6 93.6 

200/150 ............................................................ 95.0 94.5 95.0 95.0 95.0 94.5 94.1 93.6 

250/186 ............................................................ 95.4 94.5 95.0 95.4 95.0 95.4 94.5 94.5 

300/224 ............................................................ 95.4 95.0 95.4 95.4 95.0 95.4 ................ ................

350/261 ............................................................ 95.4 95.0 95.4 95.4 95.0 95.4 ................ ................

400/298 ............................................................ 95.4 95.4 95.4 95.4 ................ ................ ................ ................

450/336 ............................................................ 95.4 95.8 95.4 95.8 ................ ................ ................ ................

500/373 ............................................................ 95.4 95.8 95.8 95.8 ................ ................ ................ ................

(2) The standards in paragraph 

(d)(2)(ii) of this section apply only to 

electric motors that satisfy the criteria in 

paragraph (d)(2)(i)(A) of this section and 

with the exclusion listed in paragraph 

(d)(2)(i)(B) of this section 

(i) Scope. (A) The standards in 

paragraph (d)(2)(ii) of this section apply 

only to electric motors, including partial 

electric motors, that satisfy the 

following criteria: 

(1) Are not small electric motors, as 

defined at § 431.442 and are not a 

dedicated pool pump motors as defined 

at § 431.483; and do not have an air-over 

enclosure and a specialized frame size 

if the motor operates on polyphase 

power; 

(2) Are rated for continuous duty (MG 

1) operation or for duty type S1 (IEC); 

(3) Operate on polyphase or singlephase alternating current 60-hertz (Hz) 

sinusoidal line power; or are used with 

an inverter that operates on polyphase 

or single-phase alternating current 60- 

hertz (Hz) sinusoidal line power; 

(4) Are rated for 600 volts or less; 

(5) Are single-speed induction motors 

capable of operating without an inverter 

or are inverter-only electric motors; 

(6) Produce a rated motor horsepower 

greater than or equal to 0.25 horsepower 

(0.18 kW); and 

(7) Are built in the following frame 

sizes: any two-, or three-digit NEMA 

frame size (or IEC equivalent) if the 

motor operates on single-phase power; 

any two-, or three-digit NEMA frame 

size (or IEC equivalent) if the motor 

operates on polyphase power, and has a 

rated motor horsepower less than 1 

horsepower (0.75 kW); or a two-digit 

NEMA frame size (or IEC metric 

equivalent), if the motor operates on 

polyphase power, has a rated motor 

horsepower equal to or greater than 1 

horsepower (0.75 kW), and is not an 

enclosed 56 NEMA frame size (or IEC 

metric equivalent). 

(B) The standards in paragraph 

(d)(2)(ii) of this section do not apply to 

the following electric motors exempted 

by the Secretary, or any additional 

electric motors that the Secretary may 

exempt: 

(1) Component sets of an electric 

motor; 

(2) Liquid-cooled electric motors; 

(3) Submersible electric motors; and 

(4) Inverter-only electric motors. 

(ii) Standards. (A) Each high-torque 

and medium-torque electric motor (i.e., 

capacitor-start-induction-run (‘‘CSIR’’), 

capacitor-start-capacitor-run (‘‘CSCR’’), 

and split-phase motor) meeting the 

criteria in paragraph (d)(2)(i) of this 

section and with a power rating of 

greater than or equal to 0.25 horsepower 

and less than or equal to 3 horsepower, 

shall have an average full-load 

efficiency that is not less than the 

following: 


ddrumheller on DSK120RN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 240 / Friday, December 15, 2023 / Proposed Rules 87153 

TABLE 14 TO PARAGRAPH (d)(2)(ii)(A)—AVERAGE FULL-LOAD EFFICIENCIES OF HIGH AND MEDIUM-TORQUE ELECTRIC

MOTOR (CSIR, CSCR, AND SPLIT-PHASE MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Average full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

.25/.19 .............................................................. 59.5 59.5 59.5 59.5 57.5 57.5 ................ ................

.33/.25 .............................................................. 64.0 64.0 64.0 64.0 62.0 62.0 50.5 50.5 

.5/.37 ................................................................ 68.0 68.0 67.4 69.2 68.0 68.0 52.5 52.5 

.75/.56 .............................................................. 75.5 76.2 75.5 81.8 75.5 80.2 72.0 72.0 

1/.75 ................................................................. 77.0 80.4 80.0 82.6 77.0 81.1 74.0 74.0 

1.5/1.1 .............................................................. 81.5 81.5 81.5 83.8 80.0 ................ ................ ................

2/1.5 ................................................................. 82.5 82.9 82.5 84.5 ................ ................ ................ ................

3/2.2 ................................................................. 84.0 84.1 ................ ................ ................ ................ ................ ................

(B) Each low-torque electric motor 

(i.e., shaded pole and permanent split 

capacitor motor) meeting the criteria in 

paragraph (d)(2)(i) of this section and 

with a power rating of greater than or 

equal to 0.25 horsepower and less than 

or equal to 3 horsepower, shall have an 

average full-load efficiency of not less 

than the following: 

TABLE 15 TO PARAGRAPH (d)(2)(ii)(B)—AVERAGE FULL-LOAD EFFICIENCIES OF LOW-TORQUE ELECTRIC MOTOR (SHADED

POLE AND PERMANENT SPLIT CAPACITOR MOTORS) AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Average full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

.25/.19 .............................................................. 60.9 63.9 64.1 66.1 59.2 60.2 52.5 52.5 

.33/.25 .............................................................. 63.9 66.9 67.7 69.7 64.0 65.0 56.6 56.6 

.5/.37 ................................................................ 65.8 68.8 68.1 70.1 65.8 66.8 57.1 57.1 

.75/.56 .............................................................. 67.5 70.5 72.8 74.8 72.1 73.1 62.8 62.8 

1/.75 ................................................................. 71.3 74.3 75.1 77.1 76.3 77.3 65.7 65.7 

1.5/1.1 .............................................................. 76.9 79.9 80.1 82.1 79.5 80.5 72.2 72.2 

2/1.5 ................................................................. 78.0 81.0 80.9 82.9 80.4 81.4 73.3 73.3 

3/2.2 ................................................................. 79.4 82.4 82.0 84.0 81.5 82.5 74.9 74.9 

(C) Each polyphase electric motor 

meeting the criteria in paragraph 

(d)(2)(i) of this section and with a power 

rating of greater than or equal to 0.25 

horsepower and less than or equal to 3 

horsepower, shall have an average fullload efficiency of not less than the 

following: 

TABLE 16 TO PARAGRAPH (d)(2)(ii)(C)—AVERAGE FULL-LOAD EFFICIENCIES OF POLYPHASE ELECTRIC MOTOR AT 60 Hz 

Motor horsepower/standard kilowatt equivalent 

Average full-load efficiency (%) 

2 Pole 4 Pole 6 Pole 8 Pole 

Enclosed Open Enclosed Open Enclosed Open Enclosed Open 

.25/.19 .............................................................. 66.0 65.6 68.0 69.5 66.0 67.5 62.0 62.0 

.33/.25 .............................................................. 70.0 69.5 72.0 73.4 70.0 71.4 64.0 64.0 

.5/.37 ................................................................ 72.0 73.4 75.5 78.2 72.0 75.3 66.0 66.0 

.75/.56 .............................................................. 75.5 76.8 77.0 81.1 74.0 81.7 70.0 70.0 

1/.75 ................................................................. 75.5 77.0 77.0 83.5 74.0 82.5 75.5 75.5 

1.5/1.1 .............................................................. 84.0 84.0 82.5 86.5 87.5 83.8 78.5 77.0 

2/1.5 ................................................................. 85.5 85.5 85.5 86.5 88.5 ................ 84.0 86.5 

3/2.2 ................................................................. 86.5 85.5 86.5 86.9 89.5 ................ 85.5 87.5 

Appendix B to Subpart B of Part 431 

[Amended] 

■ 7. Appendix B to subpart B of part 431 

is amended by: 

■ a. In sections 1 and 1.2., removing the 

words ‘‘Small, non-small-electric-motor 

electric motor’’ wherever it appears, and 

adding in its place the words 

‘‘Expanded scope electric motor’’. 

■ b. In section 1.2, removing the term 

‘‘SNEM’’ wherever it appears, and 

adding in its place ‘‘ESEM’’. 

■ c. In sections 2.3, 2.3.1, and 2.3.3, 

removing the term ‘‘SNEMs’’ wherever 

it appears, and adding in its place 

‘‘ESEMs’’. 

[FR Doc. 2023–26531 Filed 12–14–23; 8:45 am] 

BILLING CODE 6450–01–P 


ddrumheller on DSK120RN23PROD with PROPOSALS2